by Web Editor | Jan 22, 2016 | News
The U.S. Census Bureau & the Department of Housing & Urban Development released its December and total 2015 statistics on new residential starts in the U.S. There were no real surprises with the data, but predicting U.S. housing starts has been virtually impossible for analysts and economists.
WOOD MARKETS has conducted its own U.S. housing forecasts since 2007 when about that time, consensus forecasts became wildly inaccurate. Since then, WOOD MARKETS has repeatedly highlighted that a structural change has been occurring in the U.S. housing market and the use of traditional economic models will not work until much later in the cycle. As a result, WOOD MARKETS own housing forecasts have been decidedly more conservative as compared to all other economists’ forecasts. Since 2007, our housing and supply/demand forecasts have been much closer to the actual results as compared to the many dozens of professional economists and modelers.
The key take-away message is this: The Consensus forecasts continue to be too high – with some being way off the charts. For those that use housing forecasts in their business plans, using the consensus forecasts in 2014 of 770,000 single family housing starts would have resulted in forecasts of almost 2 billion board feet of extra lumber demand. This type of forecasted demand increase would have suggested a much tighter supply and demand balance, where higher lumber price forecasts could be another one of the wrong predictions.
And WOOD MARKETS’ U.S. housing forecast for 2016 (in WOOD MARKETS 2016) is once again lower than the Consensus forecast – no surprise here. And our consultants have a decidedly conservative tone to North America and Chinese demand as well as prices for 2016 – all predicted before any signs of the current global economic volatility started.
From International Wood Markets: https://www.woodmarkets.com/forecasters-struggle-for-accuracy-as-u-s-housing-starts-grew-steadily-in-2015/
by Web Editor | Mar 2, 2015 | News
Composite panel consumption is projected to grow in North America through 2016, buoyed in part by the strengthening of the U.S. housing market and positive indicators of improvement in the furniture and related industries. Figures from Resource Information Systems, Inc. (RISI) project particleboard consumption to rise 10 percent in 2015, to 3.29 billion square feet, and grow 11 percent in 2016, to 3.64 billion square feet. Similarly, MDF is projected to hit 2.97 billion square feet in 2015, a rise of 9 percent, and jump to 3.28 billion square feet in 2016, up 10 percent.
Panel producers are gearing up, with already two companies announcing multi-million plant investments this year.
Uniboard announced Feb. 5 that it will invest more than $53 million at its Val-d’Or particleboard and thermally fused laminate (TFL) facility as part of its plan to increase productivity and upgrade key production areas. The company produces particleboard, MDF and TFL from mills in Val-d’Or, Sayabec, Mont-Laurier and Laval, Canada.
Uniboard President and CEO James N. Hogg said the project will enable the company to enhance its engineered wood and value-added product offerings. “Over recent years, Uniboard has invested heavily into product development, launching new color collections including North America’s first registered embossed thermofused laminate panels as well as expanding our successful NU Green range of low and no-formaldehyde products,” he added.
This followed the Jan. 26 news from Arauco that it will invest $30 million to grow the particleboard and TFL capacity at its mill in Bennettsville, SC. The new technology is expected to be in place by the fourth quarter. Arauco said increased dryer capacity will help it to improve its particleboard production by 60 million ft2, on a 3/4-inch basis annually. Arauco also will add a high-tech fast-cycle press for TFL production.
From Woodworking Network: https://www.woodworkingnetwork.com/wood/panel-supply/Composite-Panel-Market-Grows-Consumption-to-Hit-10-in-2015-294396371.html#sthash.7iZYxiAW.dpbs
by Web Editor | Feb 18, 2013 | Taking Stock
Story by Dan Shell,
Managing Editor
This issue confirms two trends in the forest products industry: The U.S. housing market is finally showing significant improvement after the most drastic drop in history; and the reliance of Europe and the UK on energy wood fiber from the Southeastern U.S. is continuing to increase as reflected in new wood pellet plants announcements.
Several years after falling off a cliff starts-wise, the housing market is showing true signs of life, with activity picking up throughout 2012 and momentum carrying into this year. Prices for OSB almost doubled in 2012 and remain strong in first quarter 2013.
As noted in the cover story on page 12, the OSB segment of industry played it cautious last year as positive economic signals increased. But by the end of 2012 several OSB producers announced plant reopenings and startups in 2013, and others were taking a close look at adding shifts or otherwise increasing production.
Meanwhile, the feature article on page 16 details an exciting time in the wood-based energy industry: Increased usage of U.S.-sourced wood fuel pellets by UK and European power producers has gained increasing momentum in the past three to four years, doubling from 2009 to 2012 and is expected to double again by 2020 (if that long). In 2012, the U.S. surpassed Canada to become the world’s largest wood fuel pellet exporter.
According to a report from the University of Georgia School of Forest Resources presented to Southern landowners a year ago, there were 29 operating wood fuel pellet mills in the region, most of them targeting the European export market. From there, Southern industrial pellet capacity is set to double through 2014, as the last round of new plants announced the latter half of 2012 average more than 400,000 tons annual production capacity.
The rise of such a forest fuel industry makes for unprecedented dynamics in timber supply, as companies more allied with the energy market than traditional forest products markets compete for their share of raw materials.
Pulp and paper producers, wood fuel pellet mills and OSB plants all compete for the same log, and while the housing picture and overall economy has a good ways to go to truly heat up any procurement competition among the three, the potential is there for issues to arise in wood baskets where all three are strong players.
At last year’s Bioenergy Fuels & Products Conference & Expo held in conjunction with the Panel & Engineered Lumber International Conference & Expo in Atlanta, forester Dean McCraw of McCraw Energy noted two misconceptions that many have: the Southern U.S. pulp and paper industry is going away; and that there’s a “wall of wood” in the U.S. South that will supply all users.
He added that the timber base can be tough to navigate: A big issue is the changing dynamics of timberland ownership and the rise of timber management investment groups that tend to manage for sawtimber instead of pulpwood.
To ensure adequate raw material supply, OSB producers should establish strong and long-term relationships with pulpwood suppliers—and be well aware that one characteristic of wood fuel pellet plants and biomass power producers are long-term raw material supply arrangements that are attractive to loggers and other timber suppliers.
Depending on your location and wood basket, unprecedented timber dynamics and new players in the market will require more focused, long-term raw material planning.
