Northeast Business Trends – May 2022

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Hardwood markets continue to be robust throughout the Northeast region, with one source stating it is “almost too good.”

“The problem is not selling,” he explained, “it’s being able to deliver. Whether it’s dealing with containers or trucks, the problem is logistics.” As a senior sales manager for a Connecticut-based sawmill, he expressed the frustration involved with having the lumber ready but not being able to move it. “We have our own trucks, which helps, but we still need to work with third-party trucking companies and it’s a nightmare. But also, of course we can’t invoice unless we ship it, so there’s a cash flow thing, as well.”

As a result, storage space is becoming an issue. “We have 40-50 loads ready to go, but we can’t get the trucks, which means we’re running out of space at the mill,” he said. Other sources had similar stories, with numbers ranging from 30 to 50 loads sitting around, waiting to be transported.

A sales and marketing manager for a Maine-based sawmill reiterated that the frustration is being felt by end users, as well. “Our end users are primarily flooring and cabinet manufacturers,” he explained, “and they consistently talk about having backlogs. Between gas prices and inflation, no one really knows how this will all play out.”

Many are embracing a wait-and-see outlook while they find ways to adapt. One sales manager for a New York lumber yard noted, “We’re having to rethink our delivery options on an almost daily basis. The demand for truck drivers is high and they’re just a dying breed. The economic climate, in general, with regard to fuel and transportation issues – that’s a make-or-break factor with many people in the lumber business right now. We’re just waiting to see what will happen.”

She added that the rising costs are not just affecting logistics. They’re also affecting every element of the lumber business, from the logger incurring extra fuel expenses to the increased cost of electricity to run a mill.

Still, her company is seeing strong sales in Hard and Soft Maples, in FAS and Better. Similarly, other sources noted that most species are selling almost as soon as they are available.

For example, one source who deals extensively with exports said that what little White Oak is available sells quickly into Europe. “Red Oak at the moment, seems to have a lot of demand,” he added.  “I think it’s probably people shifting over from White Oak to Red Oak, especially on the uppers.”

He continued to state that all grades and species are moving, but not necessarily to the same markets. “In White Oak, you might have the uppers going mostly to Europe,” he said, “but you’d also have some 1 and 2 Common moving domestically. It may vary in where it ends up, but it’s moving.”

A source from Maine has seen high demand for other species, as well. “The market for lumber is the best I’ve seen in several years, particularly in terms of what species are selling. We’re seeing high demand for Yellow Birch in 4/4 and 8/4, and 4/4 Soft Maple is very much in demand, as is Hard Maple in all grades.” He also noted that since Ash trees are still alive in their area, that is also a factor in sales. “They’ll take all we can saw,” agreed a New York source, whose sawmill stocks major lumber yards throughout the Northeast. “They’re super eager to get anything we can send their way, particularly Red Oak, White Oak and Hard Maple in FAS and Better.”

By Miller Wood Trade Publications

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

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