3 minute read

Price and supply dominate WWPA meeting

DRICE and supply dominated

I discussions at the Western Wood Products Association's annual spring meeting in San Francisco, Ca. With prices reaching record highs and the supply of raw materials plumbing new lows, many at both mill and wholesaler levels voiced concern as the industry lurched into new territory.

While higher prices brought some smiles, they were accompanied by worries over financing for both buyer and seller. Additionally, soaring prices mean costlier insurance and other operating expenses, not to mention more thievery of ever more valuable wood prcducts.

Many felt higher prices would bring skyrocketing operating costs that would prove too much for those with shallow pockets and cause under capitalized companies to fail.

The building and strengthening of relationships with mills was much in evidence. As one wholesaler put it, "Five years ago the mills took me to dinner. Now I'm picking up the [ab." As the mills scramble to find logs, wholesalers re scurrying to line up sources for something to sell.

John Hampton, Hampton Lumber Sales and associated companies, won the Man of the Year Award fuomTimber Proce ssing Magazine.

WWPA president Robeft H. Hunt, speaking at the meeting, said the combination of increased lumber use and reduced harvests in the West will create imbalances in U.S. lumber supply and demand during 1993, continuing curent pressures on lumber prices.

"Unless there is a moderation of curent federal timber policies which will put new logs into the pipeline immediately, the U.S. consumer of shelter and other products from lumber will have to pay more because of preservationists' actions," said Hunr

Lumber demand this year is expected to increase 3.9Vo ta 46926bn- lion boad feet, according !o WWPA. Hunt said timb€r supply problems have left western mills unable to increase production to meet demand. Lumber shipments from western mills declined 2.3Vo in 1992, to 18.78 billion feet Shipments ftom the region are expected to decrease by 37o this year, totaling just 18.225 billion feer Western mills started 1993 with the lowest lumber inventories in more than 20 years, he added.

Overall gradual improvements will be seen in lumber markets in 1993. As a result, lumber used in housing is anticipated to total 16.79 billion boad feet, up S.Zvo,he said. Repair and remodeling are expected to increase 3.5Vo to 15.26 billion feet next year. Together, these two markets will consume neady 707o of all lumber used in the U.S.

WPU.S. lumber exports in 1993 are forecast by WWPA to total 2.63 billion feet, down less than 17o from 1992 totals. Log exports, which dechned l3Vo in 1992, should continue to fall this year, finishing 1993 an estimated ll%o lower and nearlv 307o less than three yearc ago. While western mills will supply a lower volume of lumber to U.S. markets, other suppliers should see an increase. Mills in the southern U.S. should see shipments climb by 7.9Vo to 15.1 billion feet. Lumber imports, nearly all from Canada, are anticipated to increase to 14.56 billion feet, up 8.9Vo.

"Increased shipments from the South and Canada cannot completely make up the shortrall from the West, which still supplies 35Vo of the lumber used in the country," Hunt said. "Until multiple use principles are again returned to western forests to provide timber for people as well as the environment, the pressures on lumber markets will continue to mount."

He added that even with recent escalation, lumber prices still remain behind inflation-adjusted prices from peaks in the late 1970s. The previous record for Douglas fir lumber was $327 pt thousand board feet, set in 1979. With inflation added. the same price would be $617.

This year's meeting was the last for a while to be held within the ornate confines of the landmark Westin St. Francis Hotel. The fall meeting will be Sept. 11-14 at the Hotel del Coronado, San Diego, with next year's spring meeting at the La Quinta Resort, La Quinta (Palm Springs), Ca., and the fall meeting at the Westin La Paloma, Tucson, Az. The St. Francis will be the venue for the 1995 spring meeting. It is expected to be the site every other vear.

Sce photos pges 52 & 54 +

Story at a Glance

Glassic

WWPA Meeting Photos

(continued fron prev ious page )

PALCO{TES: (1) BillJones, Julie Wright. (2) T€d Gilberl, Bill Slevens. (3) Rick Houk, Mark Lofland. (a) Nick Kent, Ted Fullmer. (5) Wayne Holm, Jean Marc Robilaille. (6) Jim Moss, Eric Canton. (7) Jerry Ensworth, Greg Hudson. (8) Tom L. Davis, Ray Edge. (9) George Hammann, Mike Palmer. (10) Lee

Modon, Steve McCullagh, Jeff Howard. (11) Cheryl Bahneman, Jim Moss. (12) Paul Meekins, June Snowden, Gary Mallatti. (13) Susan Richardson, Marjrcrie Lynn, Jeanie Holm. (14) John Wihon, Gary Kirscher. (15) Jim Stuckey, Larry Korey, Chuck Harris, Donn Stone. Jim Bowers.

This article is from: