Some contacts commented business was more challenging, with new customers harder to acquire depending on areas contacted. There is concern heading into early winter of low log decks and more difficulty finding various grades and thicknesses for certain species while there is ample supply for others. Species identified in short supply include Walnut, Maple and Red and White Oak.
Demand of Red Oak from cabinet manufacturers is good; the species is selling well to makers of mouldings and millwork. Sales are strong to the remodeling sector. Solid Oak flooring is still a strong seller with designers and consumers. Demand on international markets is also doing well. Inventories of this species are, therefore, low and the same for kiln-dried inventories, pressuring prices higher. Poor logging conditions in many areas has put a strain on logging activity and limited log decks. White Oak production was reported as low but demand was strong. This is causing prices to increase. The demand for wooden pallets has picked up, with mills struggling to keep up to buyers’ needs.
The regionally important species Hard Maple is in demand on a variety of markets, but cabinet and cabinet components remain the top buyers. With the renovation market rising due to COVID-19, and consumers renovating their homes, sales of this species are doing very well. With demand being high, supplies are tight for some sawmill and drying operations who are trying to produce more Hard Maple. Soft Maple demand continues its steady pace, although it hasn’t gained as much market momentum as other species. Cabinet and wood components plants are the main buyers, and it has shown that there are some shortages in certain areas, particularly for the No. 1 Common and Better grades.
The low production of Ash over the past couple of months has been exacerbated by the shrinking timber availability due to the Emerald Ash Borer in the U.S., as well as by log exports. With the Chinese market improving, this has also contributed to improved Ash business. Demand for this species on domestic markets is relatively low. Sawmills, however, are having little difficulty moving developing green No. 2A and Better Ash output. Basswood sales are improved as well due to the remodeling frenzy going on both here and in the U.S. for mouldings, shutters and blinds. Secondary manufacturers have worked down their inventories and are now placing more orders. Sales to wholesalers have also trended up.
Cherry business has improved slightly, note contacts. Wholesalers and end users in the Chinese market are buying more volumes to support ongoing demand and safeguard against potential shortages. In Canada, demand is somewhat improved, most producers are prioritizing other species like Red and White Oak.
Sales of Hickory remain solid, comment contacts. Some even say that demand is outpacing supply. Flooring manufacturers in the U.S. border states have ramped up their demand and would like to get more. Exports are also strong for this species. Plank flooring producers are also looking to ramp up their supplies, as are cabinet and millwork companies.
Poplar sales remain brisk according to contacts in all regions for both domestic and international markets. Production is readily moving for green No. 2A and Better, and No. 2B is easy to sell because of the recovery in the pallet sector. As a result, prices are firming. Sales of kiln-dried Poplar to the U.S., China, Mexico and Vietnam markets are strong, with prices having risen accordingly.
Since the onset of the COVID-19 crisis, the Québec government has rolled out varying measures to address the realities of individuals and businesses. The fall 2020 Update on Québec’s Economic and Financial Situation summarizes the measures planned and taken to date to strengthen the province’s health care system, support Quebecers and restart the province’s economy amount to $12.7 billion. They represent economic interventions amounting to $35.2 billion, or 8 percent of Gross Domestic Product (GDP).
The second wave of COVID-19 is creating great uncertainty and difficult, but necessary, decisions are again called for in order to protect Quebecers, continued the report. The government is thus continuing its efforts to strengthen the health care system during the pandemic, support Quebecers and the economy as well as accelerate economic recovery.
In this regard, measures totalling $5.8 billion have been announced since last June: $1.8 billion for new initiatives announced in the fall 2020 Update on Québec’s Economic and Financial Situation; $4.0 billion for measures rolled out since the June 2020 snapshot, Québec’s Economic and Financial Situation.
The actions taken are producing results. The economic and fiscal outlook for 2020-2021 is rosier than in June. Québec’s real GDP is now projected to contract by 6 percent, compared to a 6.5 percent contraction forecast in June. The budgetary balance for 2020-2021 is stable relative to the situation forecast in June and amounts to −$15.0 billion. A provision of $4 billion is still made to offset risks related to the health crisis and fund support and recovery measures. The outlook is improving and shows gradual deficit reduction. The budgetary balance will show a deficit of $7 billion in 2022-2023. Of all the Canadian provinces, Québec has injected the most into its economy to tackle the public health crisis.
The fall 2020 Update on Québec’s Economic and Financial Situation presents the initial concrete actions being taken by the government to accelerate economic recovery and improve Québec’s economic outlook. The actions aim to: help Quebecers get back into the labour market; spur economic growth; ensure a greener recovery; promote Québec production and buying local.
We wish everyone a happy, healthy and prosperous New Year! Be safe!
