Sawmill capacity will remain constrained by bankruptcies and shutdowns, so any increase in demand will move hardwood prices higher. Weâll see the first evidence of this in late-September or October, as Asian markets begin to re-stock ahead of the New Year.
The turmoil in economic activity and stock markets have many worried about the future of hardwoods. While we will not downplay the concerns, the United States economy is slowly getting better. The last few weeks of volatility in the stock market was less about a weakening economy than about the antics of Congress and the President, and the resulting fears of investors.
Existing home sales this year are expected to total 5.0 million, slightly higher than 2010. Some other indicators have recently shown signs of home price stabilization. After what weâve been through, we consider stable sales and prices good news. Some 1.3 million homes must be constructed normally each year to meet housing demand. Given that new home construction has paced at less than half that for three years, supply will eventually break and weâll be building again.
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