Following are additional comments from Kip Howlett, president of the Hardwood Plywood & Veneer Assn. (HPVA) in response to questions on the state of the hardwood plywood industry.
Wood & Wood Products: Overall, how do your members’ sales from the last 12 months compare to the previous 12 months? What is your members’ sales forecast for the next 12 months?
Kip Howlett: Sales recovered slowly in the first part of the year but fell back to 2009 levels in the last part of the year reflecting the very slow pace of the economic recovery. Exports particularly for veneer picked up with some markets showing higher percentage increases although these tended to be smaller markets.
W&WP: In addition to offering testing programs, how is the hardwood plywood & veneer industry promoting its products’ “greenness” to consumers/fabricators? Where do you see demand for green products going in the next few months? (Increasing due to CARB, decreasing due to cost factors, status quo?)
Howlett: The green building movement is here to stay and gaining market share of the construction sector. LEED is clearly the main reference point in the commercial sector but the ICC green building code initiated by the NAHB has the residential sector lead. For engineered American hardwood products, points for indoor air quality and locally sourced have certainly available or our products. Many of our members are also able to pick up the point for FSC certification. Certainly expanded recognition of other certification programs would increase the availability of qualifying products. More and more states in the eastern hardwood region have instituted statewide programs. Wisconsin and Indiana were among the first, but Ohio has just joined the list. These programs also tend to have multiple certifications which really expands the market availability for hardwood out of these states.
W&WP: What are the biggest challenges to your members and your industry in 2011?
Howlett: The biggest challenge is the economy and its recovery. High unemployement is dampening the demand for remodeling and new homes which are key to our value chain. The housing inventory and moving new housing starts up to historical and sustainable starts is also tied to the economy and foreclosures. Cheap imports particularly in engineered hardwood products, flooring and plywood are also having a significant impact.
W&WP: What are the biggest opportunities for your members and your industry in 2011?
Howlett: The latent demand to make up for 3 years of below normal housing starts and a general recovery to jump start remodeling and furniture purchases.
W&WP: What do you think it will take for your members’ companies to have success in 2011?
Howlett: It’s the economy. All the fat, if there ever really was any, is culled out of these companies. Log prices in the near term should be stable. If cheap imports don’t flood into the domestic market and take the growth share, the domestic industry should do all right. Latin America and the Middle East will be more robust export markets for our engineered products and hardwood veneer. Asian markets for North American hardwood veneers are a mixed bag of expanding economies for growth potential but tempered with trade barriers and open access to American hardwood logs for value added processing there.
W&WP: Any other comments or important information you would like to share in regards to the state of the woodworking industry?
Howlett: American public policy needs to be more manufacturing friendly. Non-competitive tax rates, higher personal tax rates which impact family owned businesses prevalent in our sector, and new capital intensive environmental and safety regulations with very marginal benefits if any make it extremely difficult for primary manufacturing to operate in the U.S.
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