The hardwood industry is producing common-grade red oak at a much faster pace than markets can absorb it, and with log yards at many sawmills stacked high and warm weather coming, that situation won’t change anytime soon.
Flooring plants will open their gates a little wider for red oak as they work down inventories and flooring sales seasonally improve. Buyers in Asia, Mexico and the Middle East will also purchase more. Supply will continue to outrun demand, however, and keep prices falling for most red oak items through at least mid-year.
Sluggish domestic demand is clouding the overall cherry outlook despite improved exports. Cabinet and furniture manufacturing — key domestic markets for cherry — are growing slower than expected, or not at all, and flooring sector purchases of cherry are now very low.
At the same time, the popularity of darker finishes is working against cherry by allowing substitution of lower-cost woods. The cherry export picture is much brighter. January and February were the best months for cherry exports in almost eight years. Record volumes moved to China, and shipments to Canada, Vietnam and Mexico were also good. Even at today’s higher volumes, however, cherry exports aren’t large enough to offset domestic weakness, so prices will continue to soften through mid-year.
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