News Developments – October 2022

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Wellborn Cabinet Plans $17 Million Alabama Expansion Creating 415 Jobs

Alabama Commerce Secretary Greg Canfield announced that Wellborn Cabinet Inc., a family-owned manufacturer based in Ashland, AL, plans to invest nearly $17 million in an Alabama expansion project that will create 415 jobs over five years.

Wellborn Cabinet, whose cabinets are distributed nationwide, intends to construct and equip a 250,000-square-foot facility in Oxford to begin production of a new kitchen and bath cabinetry product, according to the Alabama Department of Commerce.

Using American-made products, Wellborn Cabinet manufactures traditional, contemporary, and transitional Hardwood cabinetry. Purchasing approximately 8 million board feet in green Hardwood lumber annually, products are available in Cherry, Maple, Oak and Hickory.

“It’s always great news when a successful Alabama company like Wellborn Cabinet decides to launch a significant growth project right here at home,” Secretary Canfield said.

“Wellborn has long been a landmark business in east Alabama, and I am thrilled that the company continues to grow and thrive.”

Founded in 1961, Wellborn Cabinet employs 1,336 workers within its expanding Alabama manufacturing footprint.

Wellborn Cabinet’s growth plans come at a time of rising demand for its products. Last year, the company announced plans for a $15 million project on its Ashland campus to add a planer mill, paint facility, health care, and manufacturing facilities expansion for its workforce.

“As we were looking at areas for expansion opportunities, we wanted to continue our growth within the state of Alabama,” President and CEO Paul Wellborn said. “Oxford was very accommodating and helpful throughout the process.

“The new location will be close to Interstate 20 and a broader workforce, which are both critical to our success.”

Wellborn Cabinet is one of the largest cabinet makers in North America and the largest industrial employer in rural Clay County. Its new location on 60 acres at the Oxford West Industrial Park, located in Talladega County, will extend its presence in east Alabama.

Construction on the project is set to begin in Spring 2023, and start-up of operations in Fall 2024.

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Most Recent Kitchen And Bath Study

Results from the second quarter NKBA/John Burns Kitchen & Bath Index (KBMI) study were a stark reminder that the kitchen and bath industry is not immune to overall economic turmoil.

The overall KBMI for Q2 was 70.4, the lowest it has been since Q4 2020. The index is an accumulation of members’ read on the health of the industry as well as current and future conditions — all of which had noticeable declines for the quarter.

Although any Index rating above 50 signifies expansion, the Q2 KBMI shows clear warning signs. Nearly half of the kitchen and bath professionals surveyed said they are not confident in the U.S. economy. In fact, the prediction for the Q3 Index based on respondents’ forecasts fell to the lowest reading in over two years, dropping to 61.8. They said rising costs and economic uncertainty are driving the declines.

The most recent KBMI showed that increased costs of materials and inflation have now overtaken supply chain disruptions as respondents’ primary concerns. National Kitchen and Bath Association members said year-over-year costs have risen an average of 11 percent, with over 40 percent indicating that they are passing on the increases to clients. Others said they are altering purchase decisions to rein in costs, finding lower-priced alternatives or maintaining costs and accepting lower profit margins.

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More Details Emerge from “Inflation Reduction Act”

Recently, President Biden signed the “Inflation Reduction Act” into law, initiating programs of interest to the Hardwood industry. According to the Hardwood Federation, here are some highlights, including dollar amounts authorized for specific grant programs and other federal initiatives that will impact markets for Hardwood products:

• $2.15 billion to acquire and install low-embodied carbon materials and products for use in the construction or alteration of buildings under the jurisdiction of the General Services Administration.

• $1.8 billion for hazardous fuel reduction projects on federal forest lands.

• $100 million for the Wood Innovation Grant program over the next 10 fiscal years.

• $100 million for EPA, the Federal Highway Administration and General Services Administration to identify and label low-embodied carbon construction materials and products based on environmental product declarations and other criteria.

• $2,000 per unit tax credit for consumer purchases of wood and pellet stoves, the latter of which operate on fuel derived from sawmill residuals. This credit is extended for 10 years.

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By Miller Wood Trade Publications

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

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