Hardwood Industry Optimism Rising from the Ashes
September 17, 2015 | 2:54 pm CDT

Hardwood industry optimism is higher than it has been in a long time, with prices leveling out, supplies tightening back up, and buyers in most sectors and regions placing more orders.Hardwood Review

Year-to-date U.S. hardwood lumber exports were down 10% through July—and July was the slowest export month in more than a year and a half—but sales picked up rather strongly after mid-August, especially to China.  A combination of low inventories, low production, and fears of higher lumber prices and additional yuan devaluation should drive healthy export volume gains through year-end.  What happens after that depends largely on Chinese tolerance for higher prices and the extent to which U.S. mills increase production.  The dollar is expected to re-strengthen against the euro and firm further against the Canadian dollar, which may dampen shipment growth to Canada and Europe, despite buyers’ desires to stock up ahead of price increases.

The quicker pace of U.S. residential construction and remodeling is generating additional sales for U.S. flooring, cabinet and furniture manufacturers, but also attracting competing import products.  U.S. flooring imports reached record levels in June and again in July, and the devalued yuan will only make Chinese-made flooring more cost-competitive.Hardwood Publishing Co.

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Andy Johnson