Staff Writer
Lumber suppliers and buyers throughout the Northeast area account for decreased demand and troubled pricing activity.
The source in Michigan said business conditions are about 15 percent off from the same time period last year. “Speaking from a standpoint of our immediate market, sales are strong but the pricing just isn’t there. We thought we had hit bottom and then prices dropped again last week.”
While many are feeling out of sales danger from the global pandemic that began in 2020, the effects of a stagnated market are lingering. “It’s hard to make money when we’re still dealing with higher log costs from the pandemic,” one source commented. “The demand was so high that we had to increase log costs to be able to compete. Now we’re trying to get those costs down but you can’t drop them all at once. Log costs haven’t been able to drop down with the lumber market yet and that’s what we’re trying to do right now. Our takeaway is good but we have large contracts with big players. Pricing is the issue, we’re breaking even in many markets still.”
Handling mostly Red and White Pine and Spruce, a contact in New Hampshire said Spruce-Pine-Fir is the best moving item currently. “So far our customers are still buying. The tell-tale weekend was Memorial Day and we are status quo. If the big boxes have a great weekend selling lots of lumber we’ll do good. Talking to our sales departments we didn’t see anything from that but the pricing side is pinching everyone.”
As for other factors involved, the lumber supplier said, “It’s still hard to get trucks. We built a new rail siding and we rail 500 cars a year now. Trucking is still an issue on the raw material side for logs and lumber. Probably our biggest challenge on the logging side is labor. We have a lot of crews that just can’t get guys to work and they are downsizing. That affects us in the long term when you’re trying to get wood delivered without a place to go.”
Comparing market conditions to the first quarter of 2023 a lumber buyer in Minnesota said, “The second quarter is about the same as far as lumber sales and pricing together.”
The contact, who handles Red Pine and Western Pine along with some hardwoods, noted the thicker stock is the best moving item. “If you’ve got the thicker inventory in the Commons, ready to go, you can move it right now,” he commented. “We do mostly 5/4 and thicker common boards and framing stock. That is all moving steady, but pricing is marginal.”
As for the coming months, the supplier is hoping improvements will be seen with log and lumber prices meeting. “If we can get the prices back down to coincide, we’ll see a better bottom line,” he concluded.
