North American hardwood markets continue to be average to slow, with scattered species and grades in good demand. A lot of the discussion in recent weeks has revolved around the long-term availability of some of the lower-valued species used in Asia. This picked up after one high-volume Eastern hardwood supplier ceased operations and many smaller operations in the East shuttered. For manufacturers looking for large volumes of lower-grade lumber in a species that can take a wide array of finishes, Alder stands to benefit from the market shocks out East. With two major, high-volume producers, manufacturers using Alder can rely on solid availability, competitive pricing, and shorter transit times to Asia. The lack of green lumber production across the Eastern USA is affecting markets.
Manufacturers who see improving markets in the second and third quarters should move to solidify their supply chain now, as prices are not going lower, and in fact, are starting to inch up as manufacturers see the current supply environment. North American manufacturers also now have the added benefit of improved Alder plywood availability, as supporting our Marketing Alliance with Murphy Plywood has made much larger volumes of the highly desired AA and A-faced Alder panels available.
Another positive news item on Monday is that builders’ confidence in the U.S. housing market surprised everyone this month, jumping to the highest level since July as more home buyers gravitate toward new construction amid the ongoing shortage of existing homes. Any reading below 50 is considered negative. This is the index’s first climb above the break-even point since July.
“Buyer demand remains brisk, and we expect more consumers to jump off the sidelines and into the marketplace if mortgage rates continue to fall later this year,” said NAHB Chairman Carl Harris, a custom home builder from Wichita, Kansas.
“But even though there is strong pent-up demand, builders continue to face several supply-side challenges, including a scarcity of buildable lots and skilled labor, and new restrictive codes that continue to increase the cost of building homes,” Harris added.
