Good Times Don’t Last Long Sometimes

Article by Rich Donnell, Editor-in-Chief, Timber Processing June 2021

Never—for as long as we’ve been conducting an annual Sawmill Operations & Capital Expenditure Survey—have softwood lumbermen and hardwood lumbermen in the U.S. expressed at the same time as much optimism for the immediate future, with about 92% of the softwood lumbermen and 88% of the hardwood lumbermen forecasting good-to-excellent business for the remainder of this year and into 2022.

This issue contains the reports on the results of our survey, with the softwood lumber article starting on page 16 and the hardwood lumber story beginning on page 42. Those articles obviously separate out the results for the two lumber segments. But it’s also interesting to combine the results and gain a quick snapshot of the U.S. lumber industry as a whole.

The survey was e-mailed to the lumbermen several times during April. The respondents— mostly owners, presidents, general managers and plant managers—represent about 300 individual sawmills. About 35% of those mills produce mostly 2 in. lumber, 30% produce 1 in. boards, and 12% are heavier to timbers.

About 38% of the mills have allocated at least $1 million toward capital expenditure for 2021-2022. They were given 45 areas in the mill to check off as to where the money is going. Here’s the top 10:

—Maintenance

—Log yard handling

—Lumber handling forklifts

—Dry kilns and controls

—Downstream sawing (gangs-edgers-trimmers)

—Debarkers

—Filing room equipment

—Planer mill sorting and stacking

—Metal detectors

—Dust control

The results of the granddaddy question of them all: 46% forecast their lumber business situation as excellent for 2021-2022 and 46% forecast it as good.

That’s no surprise, given the tsunami of record lumber prices, which has been driven by several factors, supply-demand obviously at the heart of it along with some supply chain logistics, but more specifically a supply that has yet to catch up with demand dating back a year ago to the pandemic, as home repair surprisingly boomed to the degree it did, and then new housing took off and continues to rise, partially brought on by that demographic of young professionals who had too much student debt to enter the market, until now, and a flux of oldtimers deciding to build second homes or sell their existing ones and build a new one, and now perhaps multi-housing finding some momentum, all of this leaving sawmills to wrestle with their production capabilities, while wrestling with their labor pool, and now staring straight into another 20% potential leap in new housing—if you’re thinking 2 million starts.

Still, especially given the “new” federal government, as some comments in our survey bear out, lumbermen may be uneasy not knowing how soft the softening of these unprecedented lumber prices and demand will be once it comes, how quickly it might come, and how much government interference or some strange occurrence will be entangled with it.

RELATED ARTICLES

Survey Says: Lumbermen Are Feeling The COVID-19 Pinch

Latest News

Multi-Family Leads Way In U.S. Housing Jump

After a downward slip in July, U.S. housing starts, riding a multi-family hike, increased to a seasonally adjusted rate of 1.615 million in August, 3.9% above July and 17.4% over August a year ago, according to the U.S. Census Bureau and U.S. Dept. of Housing and Urban Development monthly new…

Forest Service Cancels Arizona 4FRI Phase 2 Process

Anxious bidders for the Phase 2 contract that’s part of the federal 4 Forests Restoration Initiative (4FRI) seeking to treat and improve forest health conditions on more than 2.5 million acres across four Arizona national forests were told to wait a…

Binderholz Implements Solutions From Trimble

Binderholz is implementing Trimble Forestry’s LIMS and WeighWiz solutions for its newly acquired sawmill location in Live Oaks, Fla. LIMS is a widely used log accounting and contracting system. LIMS provides management control over all phases of timberland, woodland, yard and mill operations…

IFG Closing Tricon Timber

Officials with Idaho Forest Group announced at the end of August the closure of its St. Regis, Mont. sawmill in late November. The company had acquired the mill in 2017 from Tricon Timber. A post on IFG’s website from August 2019 noted the company had added a sprinkler system, replaced some older equipment and…

Find Us On Social

Newsletter

The monthly Timber Processing Industry Newsletter reaches over 4,000 mill owners and supervisors.

 

Subscribe/Renew

Timber Processing is delivered 10 times per year to subscribers who represent sawmill ownership, management and supervisory personnel and corporate executives. Subscriptions are FREE to qualified individuals.

Advertise

Complete the online form so we can direct you to the appropriate Sales Representative.