Structu ral panel m arket is alive & well

Story at a Glane

Structural panel supply favorable...southern pine ply- wood fills gap left by fir shortages....APA projects incrgased use.

;\PTIMISM abounds in the Vstructural panel market as late summer demand for sheathing and underlayment firmed sales at both contractor and d-i-y yards.

Prices continued to rise and supply remained favorable as the South picked up the slack in production and southern pine plywood began to find its way into areas nomrally served by fir plywood. OSB held steady as a contender although its price also was moving up.

The strength of the August market "points toward a late developing market that has underlying strengths," C.C. Crow Publications said in its weekly newsletter. "Thag at least, can be seen as a sign of hope in what has been a dull second half'

Because of a better fiber supply, lower labor costs and access to major markets, the South is becoming the primary producer of sfructural panels. In 1991, 68 southern mills produced 13,597,000 square feet, 567o of total U.S. production. In the West, the coastal region produced 5,114,000 square feet (21.1Vo) and the inland region produced 2,473,W square feet

(l0.2%o). OSB accounted for 23Vo with 28 mills. APA estimates that this will increase to257o by 1996.

Total residential construction including remodeling is expected to use 13.2 billion feet of sructural panels this year, the American Plywood Association projects. By 1995, the market should reach 15.4 billion feet. Although fewer homes are being built than in the 1980s, increased square footage and a reasonably good single family market are requiring more panel products. Single family homes are using 8,400 sq. ft. of panels on average with a multifamily unit requiring 3,155 sq. ft.

The volume of structural panels per home can be increased by selling the APA Code Plus Home program for contractors. The combination of thicker panels and use of structural panel wall sheathing can raise the average structural panel use per home to over 10,000 sq. ft. APA is in the midst of developing plans for the 1993 promotion of Code Plus with point of purchase displays for retailers and seminars which retailers can sponsor in conjunction with contractor nights or special events.

Retailers can sell the Code Plus program's advantage of ensuring earthquake and wind resistant homes. Wood frame construction performed well in both the 1989 San Francisco, Ca., earthquake and 1989's Hurricane Hugo on the eastern seaboard. Franklin l,ew, seismic safety manager for the city and county of San Francisco, said, "Wood frame buildings designed to provide lateral resistance are less likely to sway and drift in an earthquake. This limits breakage of electrical, gas and water lines within the building, thus reducing the chance for catastrophic fires." The Code Plus Home program applies nearly 40 years

Customer Confusion?

Selling plywood used to be pretty simple. If your memory is long enough, you probably recall that ll4, ll2 and 314-inch thicknesses covered your sanded softwood and hardwood plywood inventory with some 3/8 and 5/8inch rough sheathing to handle sidewall and subfloor construction. Things have changed.

Today your plywood panels are sbaring bin space with OSB, particleboard and, perhaps, medium density fiberboard products. Panels now come in mind numbing thicknesses like 7ll6-inch and 23132inch.

"Ibr hearing from more confused and frustrated customers, both homeowners and professionals," says Bill Rooney, bost of the weekly d-iy call-in radio show "Around the House with Bill Rooney" on station KXL, Portland, Or. "They buy a project plan for a simple bookcase calling for 314-inch sides and a l/ulinch back. However, when they start assembling the bookcase, the thicker panel is 11/16-inch and the thinner is 3/16-inch or 4mm and all their dimensions are off. One d-iyer complained tbat he spent more time with calipers in hand than a hammer or saw."

"And even the professionals aren't always sure what they are buying. I continue to see dealer newspaper ads featuring special prices on'Waferboard' or'Waferwood'panels yet, as far as I know, only oriented strand board is produced today by domestic manufachrers,. he said.

So how does the retailer regain customer confidence? Management must make sure its sales staff, invoices, bin markers and advertising list accurately the actual product size and description they are selling. A credibility check is tbe only answer to eliminating customer confusion.

important that OSB products are made from plentiful, noncontroversial timber sources including hardwoods such as aspen. Access to these raw materials has brought OSB plants to areas such as wisconsin.

"Retailers can save money for their customers and come in with a low bid," advises Mel Williams, lumber deparrnent salesman at Boise Cascade in Phoenix, Az. "OSB products perfonn the same as rated plywood panel products." They have the same performance ratings without voids or knots and are uniform. Their stiffuess can be an advantage although the extra weight in some thicknesses bothers a few people, he adds.

Educating the builders is essential, according to Butch Miller, sales manager at Martco OSB, Alexandria, La. Builders should know there are "things you can do and shouldn't do" with OSB, he explains. "A retailer can get a leg up with his builder customers by showing them the APA film on panel installation."

Martco, which sells Tuff Srand in a market area reaching from Alabama to Arizona with an emphasis on Texas and some customers in California, Georgia and Florida, packages the products with complete instructions plus an 800 number to call for additional help.

Education is also stressed by Jim Harrison, operations flumager at Georgia-Pacific's San Leandro, Ca., distribution center. He recommends that dealers get to know the OSB products better and develop an easier-to-sell niche market. He also stresses the advantages of being able to give a customer a lower price on a bid if he is familiar with OSB and what it can do. Harison suggests that dealers should stock OSB as well as plywood panels to familiarize customers with the product. He's another advocate of APA and manufacturers'films and literature.

of APA research in earthquake and wind resistant design.

Oriented strand board products have captured a significant portion of the structural panel market in the past 10 years. Price has always been an advantage for OSB, although the spread between plywood and OSB costs is now minimal. With the current climate of preservation, it is

Louisiana-Pacific, which has 16 OSB plants with a total capacity of about 3 billion square feet a year, is a good example of a manufacturer who backs a dealer with quantities of informative information. They offer an OSB print advertising kit, brochures, counter cards and envelope stuffers for dealers selling Inner-Seal products.

Regardless of whether he is selling traditional veneer type structural panels or the OSB products, a dealer should be able to count on completing the year with relatively strong sales.