Southeast Business Trends
The Southeast Focuses On Yellow Pine And Tariff Shifts
By Lara Stearsman
Associate Editor
At the time of this writing, the Southeast region sees a slow-moving market but a more positive expectation for the upcoming year.
A lumber company representative out of Alabama said the market is “slow” and was “just the same” six months ago with very few good months for sales.
“It may be the weather but really a lot of people are scared. They don’t know, with the tariffs going on, what’s going to happen. They’re only buying what they have to have. They’re not speculating on anything right now like they normally do. Before, they would buy 20 loads at a time but they’re buying only one now,” she said.
Her company sells Southern Yellow Pine and Precision End Trim (PET) materials. The Southern Yellow Pine is available in everything between 8-inch and 12-inch regular stock while the PET material is offered in 2×4, 2×6 and occasionally 4×4. They are both offered in prime, No. 1 to No. 4 Common and wets.
“Right now, the PET material is doing better than regular lumber, because there’s a lot of job sites that book out three months at a time, so the PET material is moving a lot better than the regular stock. The PET material is sold by our office in Florida and we sell the regular stock. We sell a lot to traders, truss manufacturers, pallet companies and wholesalers. So, it’s just a wide variety,” she said.
While transportation has not been an issue due to having “more truckers than orders,” they have seen a direct impact from tariffs. “The big Canadian companies have shut down around us here, and that helped us somewhat. Every little thing helps, but most people seem to think it’ll be like this the rest of the year. They don’t think we’re going to see another change until next year. So, it’s going to be a struggle the rest of the year if that’s true,” she said.
A lumber salesman in South Carolina stated the market is “not great” and then followed up with “there’s just too much wood in the world right now.” Compared to six months ago domestic sales are more challenging while exports are doing well.
“We’re small, so we usually like to put people on 3-month programs and know what we’re going to make, know where it’s going. Now we have to hold more inventory and be able to ship it when they need it right now,” he said.
“People won’t look any further than about a week for shipments.”
Selling best in the Southeast is Yellow Pine and PET Material
They market 100 percent Yellow Pine in 4/4 and 8/4 with 8/4 selling the best. Most of their sales are to manufacturers for moulding, millwork or “appearance grade treatment.”
“They say they’re less confident about their sales and about holding inventory. They’re seeing things change, people are changing specs for species, thicknesses, lengths or widths. There are products they were importing before that they aren’t importing now. Their imports have dropped in prices so they’re able to buy the import cheaper and they like the import. So, there’s just not a lot of excess demand but there is excess production,” he said.
Transportation has not been an issue for them but there have been issues with tariffs. “It’s just the lack of certainty. Some of the lower grades that were going to China are not now, and some of our customers have moved their production facilities to other countries like Malaysia, Thailand or Indonesia. It’s a lot of unknown,” he said.
A Louisiana lumber company spokesman commented on the market being “slow,” with a similar report for the past year.
“Last year it was everybody waiting on the election to be over with and now they are waiting on tariffs, but I think it’ll pick up. The world economy is kind of down right now. I mean our economy is good but everywhere else seems to be not so good,” he said.
His company offers Yellow Pine and Sap Prime in No. 2 and Better, 1-inch to 4-inch with 1 5/8-inch, 3-inch and 4-inch in the highest demand. They sell to primarily importers and wholesalers.
“We’re an export mill so our main market is out of the country and most of the places we go made deals on the tariffs. So, it was a problem before and it’s kind of made everybody hold off on buying but I think it’ll pick up now that all of that has settled,” he said. Transportation has a “back log” and there have been issues getting “bookings on ships” according to him.
