Midwest Business Trends – November/December 2022

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Sources throughout the Midwest said that their sales have continued to be steady over the past six months. However, some did mention that they are beginning to see a slowdown, at the time of this writing.

In Texas a lumber salesman said that while his company has seen a bit of a slowdown in recent months, it hasn’t been anything drastic.

“The custom market has remained steady,” he said. He also mentioned that the market seems to have slowed down due to interest rates rising and less tract homes being built.

He markets No. 1 Common and Better, Green Douglas Fir in 4×6 to 20″x20″x40′ Standard and Better, and Western Red Cedar. He said that at the time of this writing that Douglas Fir is his best seller.

His customers are primarily retail lumber yards. “Their business has slowed down some as well because of less tract homes being built, but their customers are still doing custom work,” he said.

He noted that transportation hasn’t been an issue for them since they have their own fleet of trucks.

In Missouri a sawmill representative said that his sales have been good, but they have slowed down since this summer. “I think that there is fear in the marketplace; people are taking a conservative approach. People have had a pretty good two-three years and they don’t want to take a huge hit, especially with winter right around the corner,” he said.

He remarked that things are worse than they were six months ago. “The market is headed to a pre-covid kind of pace. Mills and suppliers are starting to come off allocation. Big homebuilders are starting to hold off on production as interest rates rise,” he said.

He handles Spruce-Pine-Fir and Douglas Fir in No. 2 Common 2×4-2×12, and Western Red Cedar in 1×2 all the way up to the biggest timbers in all appearance grades. He noted Green Douglas Fir seems to have held on to its value, while Spruce-Pine-Fir seems to have been slower, with it having taken bigger price hits.

He predominantly deals with pro dealers and contractor yards, while he does sell to some box stores. He said that most of the information that he has heard comes from his customers with it being consistent across the Midwest. “It’s pretty apparent that there is a slowdown coming and it’s already started,” he said.

He said that at the time of this writing he wasn’t having many problems with transportation, especially after having such a horrible summer. “The rail lines seem to have gotten better. Trucks are still not easy to find, but it’s OK,” he continued.

In South Dakota, a lumber spokesperson said that the market was busy. “We are moving a lot of lumber; the trucks are full,” he said.

He said that for his company the market “hasn’t really slowed down over the past year.”

He markets Cedar, Spruce-Pine-Fir, White Douglas Fir and Hemlock Fir in 1x and 2x in No. 2 Common Select Struct, as well as knotty Cedar. He said that Spruce-Pine-Fir in the narrows and Hemlock No. 2 Select Struct in the wide are his best sellers.

He sells to lumber yards and manufacturers. “They are buying what they need; they continue to stay busy,” he noted about his customers.

He said that the issues with transportation haven’t really affected his company. “We own about 15 trucks between our three branches. We also hire independent haulers,” he said. He said that getting rail cars has taken a little bit longer.

By Miller Wood Trade Publications

The premier online information source for the forest products industry since 1927.

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