by Web Editor | Aug 17, 2016 | News
The 2016 Structural Panel & Engineered Wood Yearbook has been released by APA – The Engineered Wood Association. The yearbook includes an analysis of the U.S., Canadian, and global economies, focusing on factors that impact demand for engineered wood products across several market segments as a basis for forecasting expected production of engineered wood products over the next five years. Besides the analysis and forecast, the yearbook also includes historical data on engineered wood production. Topics examined in the yearbook include:
• U.S., Canada, and World economies
• Residential construction in the U.S. and Canada, new and repair/remodel
• Nonresidential and industrial markets
• North American imports and exports
• Outlook and production statistics for structural panels (OSB and plywood), including historical data
• Engineered wood product demand and production (glulam, I-joists, and LVL)
Driven by healthy employment gains over the last three years, annual household growth in the U.S. is back to the 1.2 million level, with demand for new housing units also back to the 1.5–1.6 million unit level. Buoyed by low interest rates, which are expected to remain below 4 percent for most of 2016, construction of new single-family homes in the first quarter of 2016 was up almost 5 percent from the pace of the fourth quarter of 2015, the highest quarterly starts rate since the fourth quarter of 2007. While demand is high in the U.S., the primary concern for the rest of 2016 and for the next several years is the ability of the supply-side forces to respond to this improvement. Home builders report that factors including a lack of developed lots and the shortage of skilled construction labor have combined to constrain their ability to respond to the increased demand for housing. Eventually these constraints will lessen; housing starts are projected to return to approximately 1.5 million units by decade’s end, with a concurrent growth in engineered wood products output ranging from 19–28 percent during this period.
From Woodworking Network: https://www.woodworkingnetwork.com/news/almanac-market-data/apa-releases-2016-structural-panel-engineered-wood-yearbook?ss=news,news,woodworking_industry_news,news,almanac_market_data,news
by Web Editor | Jan 25, 2016 | News
Demand For Engineered Wood Products To Grow Through 2020
Engineered wood product output will grow between 25% and 33% by 2020, according to the Fall 2015 Forecast by APA – The Engineered Wood Association. That should bode well for LBM dealers as the housing market continues its gradual recovery.
APA’s 2015-2020 Market Outlook for structural panels and engineered wood products forecasts that demand for North American-made structural panels will increase 21% by 2020, from 31.5 billion square feet to 38 billion, largely in response the increase in housing starts to 1.5 million units by the end of the decade.
APA’s forecast for an uptick in demand for structural panels and engineered wood doesn’t surprise J.D. Saunders, the 2014-2015 chairman of the National Lumber and Building Material Dealers Association (NLBMDA) and vice president of Economy Lumber in Campbell, Calif. “We’ve already experienced an increase in demand, and part of that is attributable to the recovery of the housing market,” he says.
In fact, APA’s Market Outlook notes that although the U.S. homeownership rate is expected to trend lower through 2020 as interest rates rise, the improving economy could push household growth as high as 1.3 million per year over the next three to five years.
Several factors are dampening the potential for stronger growth in homebuilding. Young would-be homeowners are delaying marriage as they pay off historically high levels of student debt and their projected incomes are unlikely to keep pace with the rise in mortgage payments as home prices and interest rates rise. In addition, first-time home-buyers continue to struggle to meet strict mortgage lending standards to qualify for home loans. Many of the households they form in the near future are likely to be living in rented apartments, as described in the APA report.
From LBM Journal: lbmjournal.com.
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by Web Editor | Jul 6, 2015 | News
APA – The Engineered Wood Association has released its 2015 Market Outlook report.
Similar to 2014, extremely harsh weather caused home building to stall in the eastern half of the U.S. during the first quarter of 2015. However, with mortgage rates below 4 percent, new home sales rose 9 percent versus the fourth quarter of 2014, an indication that new home demand is improving. Brighter employment prospects for young adults is leading them to head out on their own, adding to the strength in the demand for new apartment buildings. These forces point to the recovery in residential construction getting back on track in the second half of this year.
“The biggest changes in the economic environment since a year ago are the strength of the U.S. dollar, the drop in oil and gasoline prices, and efforts by central bankers to stimulate their economies by driving down long-term interest rates,” said Joe Elling, market research director for APA. “This mix of events is likely to support lower interest rates in the U.S. than what was expected a year ago at this time. We are still in an unprecedented situation with respect to Federal Reserve policy though, and I remain concerned about the ability of the Fed to return its balance sheet to a more normal state without a major disruption in financial markets here and abroad.”
Critical to the strength in the demand for new housing is the ability of young adults to have the economic wherewithal to be on their own and, ultimately, to be able to own a home. Despite very favorable affordability conditions from a monthly standpoint, tight lending standards and heavy student debt burdens are constricting that group’s home-buying power. These conditions are expected to persist through the rest of the decade; thus, as housing starts return to their anticipated 1.5 million level by 2018-2019, multifamily starts are expected to account for roughly 36 percent of the total.
Housing starts in Canada totaled just over 198,000 units in 2014. Canada did not experience a housing bubble like the U.S did, but, similar to the States, multifamily unit structures are accounting for a greater share of new residential construction compared to 10 years ago. The forecast calls for starts in Canada to run in the 180,000-190,000 unit range, with multifamily units accounting for around 40 percent of the starts.
From APA – The Engineered Wood Association: https://www.apawood.org/market-outlook-2015
by Web Editor | Jun 5, 2015 | News
Business is improving, albeit slowly, for the composite panel industry. The news set the tone for the Composite Panel Association’s spring annual meeting, which saw its highest attendance since 2007. More than 280 people, representing 118 woodworking firms and related organizations, converged on Bonita Springs, Florida, May 31-June 3 for the event.
Dr. Bill Conerly, Conerly Consulting LLC, kicked off Monday’s session, providing an economic outlook for building materials, including a look at new opportunities and risk factors. Although the early outlook is positive for 2015 and 2016, he cautioned companies to take a “flexible stance” when planning for a changing economic landscape. In a nutshell, he said, the most likely economic scenario will be: “better markets for composite panels, stronger growth in the rest of 2015 and for 2016, higher interest rates, and oil prices around $60 to $70.”
To ensure they stayed successful, John Spence of John Spence LLC provided wood industry executives with a winning formula: (T+C+ECF) x DE = Success. The elements in the equation represent Talent + Culture + Extreme Customer Focus, multiplied by a Disciplined Execution. Culture, he explained, should not only reflect what corporate wants, but employees’ needs as well. Spence cited a recent study which found employees are most satisfied in their jobs when the following terms are met: parity in pay, challenging work, cool colleagues, a winning culture/fun workplace, the opportunity for personal and professional growth, and a boss or leader that can admire.
“One of my favorite sayings is ‘Ambiguity breeds mediocrity,'” Spence added. To avoid that pitfall and create a good corporate culture, there needs to be: goal setting, trust, communication (open, honest, robust and transparent), accountability (personal and mutual) and recognition. “The customer’s experience will never exceed the employee’s experience,” he added. “Create a culture that catches people doing things right.”
From Woodworking Network: https://www.woodworkingnetwork.com/news/woodworking-industry-news/composite-panel-group-meeting-kicks-optimism-high-attendance?ss=news,woodworking_industry_news
