Lumber & Plywood Market Watch - August 2021 Update
If you have been watching the evening news lately you are likely to find a story about how lumber and plywood pricing is finally starting to stabilize and come back down. A welcome update to be sure - but unfortunately this news mostly just applies to our counterparts in the construction industry. Their lower grade materials are often subject to more dramatic price swings and their production capabilities allow them to more quickly respond to the shifting market demands. What does that mean? Basically the availability of inventory has now matched the demand for their product - which leads to a more competitive market and lower prices for the end consumer.
This is a stark contrast to our experience as we try to navigate the Hardwood Lumber and Plywood business!
Our prices on domestic plywood are at an all-time high as we continue to see stretched lead times and very low inventory from all our suppliers. At this point everything is still available but we are at the mercy of the domestic plywood manufacturers which are trying to increase production to keep up with the market demand.
Naturally when the domestic market is under stress there is an increased demand for Imported plywoods as customers look for alternatives. Factor in higher freight costs and shipping issues and that also means the pricing of Chinese and other Asian plywood panels have steadily increased - in some cases matching the “old” domestic price points!
Russian or Baltic Birch is not to be spared either. There are many in the industry that believe we may not see much new Baltic Birch arriving to the North American market for the remainder of 2021. This is almost absolutely true for the thinner stock like ⅛” and ¼” - but starting to become a reality for the more standard 1/2” and ¾” thicknesses too.
In general Hardwood lumber prices have remained high - but at least stable. Species like Black Walnut and White Oak remain very popular and are still a challenge to buy in the lengths and volumes we require. With sawmill production trying to keep up with the most popular thicknesses like 4/4 - it usually comes at the expense of some of the more specialty thicknesses like 10/4 & 12/4 material. Our suppliers are warning us that this thicker stock will continue to become less readily available and require much longer lead times.
What does this mean for KJP and our customers? We hope other than pricing - you don’t notice too much of a difference. We are doing our best to take strong positions on all the items that are projected to have low availability over the next few months so we can continue to offer you the premium woodworking products you need.
Thank you for your continued patronage over this challenging year. We very much appreciate every single order we fulfill and we wouldn’t be here without you! We hope the Fall brings you continued good health to you and your families!