Southeast Business Trends

Jan Issue

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Southeastern lumber representatives reported strong market activity in recent weeks.

For a Georgia sawmill that processes wood in two states, the market is doing well. “Business is good,” said the sales manager. After a bit of a fallback on prices, the prices over the last 90 days seem, in most cases, to have bottomed and rebounded. “Maybe not to the point to where they were before they softened, but cryin’ out loud, lumber was at such record prices we knew at some point in time they had to come down,” he commented.

The Common Red Oak market is good while all the White Oak markets remain favorable. 

The executive said he expected his FAS Red Oak markets to return to where they need to be. All his No. 2 Common Poplar was spoken for through the first of January, to be sold as it comes through the system and gets dressed and gets put-up and ready for shipments. The operation also sells small amounts of Ash and Cherry to its customers, which include flooring and pallet manufacturers and Hardwood distribution yards.

“When you look at the overall book of business, we are not in a position to where you have to worry about selling those six loads of FAS Red Oak,” he quipped. “We’re not out looking to have a fire sale on any of that stuff. We are just looking for the next good business that comes our way.”

Because of weather changes, logging until March will be difficult at best, he cautioned. “It will have some effect on our business, too,” he predicted. 

“The flooring markets are still bullish and still strong,” he assessed. “They’re helping prop-up the back end of the sawmill.”

The operation cuts 4/4 lumber for White Oak, 4/4 and 5/4 for Red Oak and 4/4 to 10/4 for Poplar.

In Arkansas, the president of a Hardwood flooring manufacturer who sells to wholesale flooring distributors throughout the U.S. characterized the flooring market as robust. “Demand for flooring exceeds supply,” he said. “It’s better than it was six months ago. It’s at the top.”

The equation remains favorable. “Flooring demand in relation to supply is about as tight of a market right now as you could get,” he said. “It will likely become looser slowly over time and the less differential between supply and demand.”

The firm buys No. 1, 2, and 3A Red and White Oak.  

Labor is still the main factor effecting his business and his customers’ sales. “We have a very tight labor market,” he said. “Transportation is average.”

A Mississippi lumber wholesaler who sells to clients nationwide is experiencing its most successful sales year. “I would say we have the strongest market I ever recall having in 20-plus years,” he said. “Our sales are good. We are having the best year we have ever had. It’s probably two to three times better than we ever had in the past.”

While the company’s furniture manufacturing customers’ business is also doing well, they are facing holiday-related back-ups as well as labor shortages and a shortage of imported foam and fabric. “Many are slowing down because consistent with what we see on TV, a lot of imported product is sitting on ships off the California coast,” he observed.  

Red Oak and Poplar sell the best for the firm which also sells White Oak, Hickory and Gum to Hardwood floor and furniture manufacturers. All grades, from pallet lumber to FAS, are handled with most thicknesses being 4/4 and 5/4.

By Miller Wood Trade Publications

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

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