With dropping lumber prices, when will demand for sawmills follow?

[Southside]

That's a pretty expensive chicken finger combo. $23 paid for my wife and I to go go Golden Corral just a couple of years ago.  

[beenthere]

Maybe where a lot of the Ford trucks are at? Stock piled and waiting for some parts??
We Discovered 40,000 Unfinished Ford Super Duty Trucks! - YouTube

[Walnut Beast]

I hear you Yellowhammer 😂. What's also happening is company's are not taking orders from dealers even if they want units. One guy I talked to was supposed to get 31 ASV units in for the year and they got 13. My friend told me about a dealer in Texas that got six ASV 135s in. I called and the guy told me they got four in and everyone had canceled because of the wait. He said you couldn't blame them. They were a little concerned. Four 143k machines. They all sold in one day when they came in. 

[SawyerTed]

I talked with Carolina Saw & Service just a few minutes ago. They are my closest Woodmizer Dealer.  Can I say I continue to receive excellent customer service from these folks. 

For an order for an LT 50 placed in Jan. 2022, current delivery is "around" March '23.   That's improved from July '23 from the last conversation I had with them in May.  It is still 60 weeks. 

But I was asked this question, "If an LT 50 comes in AND the customer cancels, are you ready to take delivery?"

My answer was, "Absolutely, put me on the list to take delivery of a mill that meets my order."

That leads me to believe the cancellation of orders is a reality and moving manufacturing dates closer to a typical 3-4 months lead time. 

So worst case, I'm still waiting 6 more months.  Best case is I get an early Christmas present.  :D

[bigblockyeti]

That leads me to believe the cancellation of orders is a reality and moving manufacturing dates closer to a typical 3-4 months lead time.

So worst case, I'm still waiting 6 more months.  Best case is I get an early Christmas present.   :D

That's where I got my mill from and admittedly an LX55 take a whole lot less time to slap together than an LT50.  My order was placed at the beginning of March '21 with an expected delivery of 12-14 weeks, I picked it up 7 weeks later.  I wouldn't be surprised if you get it much sooner provided the fed keeps doing what they've long needed to do before now.

[customsawyer]

YH if you are determined to spend 250K, :D I'll sell you some cypress.

[jpassardi]

"Yet I have a load of exotic lumber coming from Canada next week at pre pandemic prices and free shipping.  From Canada to Alabama.  I couldn't even get these species in the US except for criminally high scalping prices.  Figure that one out."

I assume much of the exotic lumber originated from South America? Talk about trucking...

[YellowHammer]

I have 5 different places I purchase exotic species, depending on what they have and when they have it.  Typically, exotics come in on container ships to the Gulf Coast or Atlantic side, and are shipped to distribution houses from Mobile, Alabama, Tennessee, North and South Carolina, Mississippi and Georgia.  At that point they sell at wholesale cost to retailer, such as myself.

So for example, a recent species had been raised $2 per bdft with an additional $2 per bdft for shipping from South Carolina to Alabama, so for me to get it from South Carilona, just a few hours away, it was going to cost me an additional $4 per bdft.  That was the lowest markup I could find from any of my US distributers.  I wasn't going to do it.    

So I ordered the exact same species from Ontario, Canada, and saved the $4 per board foot.  Now here is the part that lit me up.  The only company on the US that had that particular species called me up and told me they had some coming and it would only be a few months more.  Yeah, right, I said I have a second truck with a load coming in next week.  He went ballistic, and got mad at me because I had the audacity to get it from out of the country, instead of waiting a "few more months" to get it from them at a much higher price.  Then he went on a rant that it should be a "Congressional thing" that should be stopped, (I assume competition from Canada) and while he was ranting, he spilled the beans that he knew where I had gotten that wood and was also mad at them for selling to me and undercutting his price.  So I said, do you understand how that sounds???. You sold to them at a lower price than you ever sold to me, low enough for them to resell to me and and still make a profit, and yet you want to charge me an additional $4 per board foot!!  And you are mad at ME!  Do I have Stupid stamped on my face! Oh, I unloaded, big time.  

However, the reality of the situation is not lost on me, how many other things is this happening with?    

[Percy]

I keep reading how lumber prices are back to pre pandemic levels but it ain't happening in my part of the world. I'm confused

[barbender]

Some of those outfits feel completely entitled to rob you YH, it would appear🤦‍♂️

[terrifictimbersllc]

Can someone explain to me the scenario where someone would order six LT 35s? Is that an individual who is planning to either sell his place in line or to purchase and then resell when they come up one at time? I would think either Woodmizer or the fact that there's probably state sales tax involved would end those plans in a hurry.

Somebody help me with this.

[bigblockyeti]

It wasn't explained to me in detail but I suspect the low risk of buying now with a refundable deposit made the prospect of reselling at 15% over cost attractive to some.  Heck if you bought six and sold 5 of them for a decent profit, the last one you could keep for free.  I've been offered $9k for my LX55 which seemed high to me, but I'm not interested in selling even if there was money to be made (at least not that much money anyway).  I've seen the same thing happen with vehicles that have been on order forever, the customer finally gets it and some yokel offers them 50% over what they paid, for many it's hard to turn down.  The example that stick out in my mind was a guy who ordered a new Bronco, $65K all in, spec'd just how he wanted it and when it rolled off the truck another guy wanted it bad enough to offer him $115K, I'm pretty sure he took the deal.

[richhiway]

I just believe  there are a lot of sawmills out there that folks purchased for a lot of wrong reasons . Also a lot of poor lumber and slabs are just sitting and going unused. As interest rates rise the economy is going to slow at some rate. If $$ gets tight a lot of used mills will be for sale. I also am of the opinion that a lot of interest in mills was driven by you tube videos at I time when guys had a lot of extra time and $$. It looks really easy on a video to make some lumber and build your dream cabin. The reality is that you need a lot of support equipment and milling is hard work. You also need to be handy mechanically to take care of your mill and keep it running smoothly. If you follow the wood-mizer facebook page you can tell a lot of folks struggle with their mills. On the other side of the coin is a whole lot of people are doing well with milling and building some beautiful buildings and projects. I would never believed so many folks would go into milling. For many years there was only one wood-mizer in my whole county. the rough cut/sawmill/hardwood part of the lumber business is a sub section of the lumber business I do not think it is connected to the commercial building lumber price wise. We serve a different type of customer most of the time. It does not matter what a 2x4 costs at lowes if you need a 8x8x16 foot beam. I don't think retail lumber will fall in price that much but if it does I don't see it has a direct connection to rough cut lumber.

In any case the last few years has truly changed everything I thought I ever knew about business. I call it clown world. The masses will apparently pay anything for some item they want or think they can't get. So I do not think I can predict anything. I just do me in my pre historic way and hope maybe there will be a resurgence of normalcy at some point. 

[SawyerTed]

All those live edge 8/4 tables, bar tops and mantles selling for crazy prices got a lot of attention from people who thought they would just tap into that cash by buying a sawmill.  

They did the math and figured they could sell 5 or 10 a month at $300 each!  After a few months, it will all be profit!  Of course their buddy with a tree service will give them logs for free!   

My buddies say they will help around the mill.

Who knew I needed a 65 hp tractor or skid steer?   You mean daddy's Massey Ferguson 135 won't lift a 26" white oak log?  

Where do I get a blade?  The one that came on the mill is dull.  

Oh no!  That freshly cut mantle I charged you $300 for has split and cracked?  I don't have any idea why that happened.

There are mushrooms growing out the sides of my lumber stack and there's some kind of stuff growing between the boards that causes them to stick together.  I

I've cut a 24" wide live edge slab that's 12/4 thick, it's heavy!  

My 3 buddies who said they would help on the mill went fishing together!  I don't have any help.  

Highly valuable walnut logs!! $$$$$

Sales tax?  I have to collect sales tax?

Insurance?  Why?

This is dirty and hard work!

[moodnacreek]

I have one customer the ties me to new housing market. He goes into new empty homes and does shelves, mirrors, glass doors, wire stuff and such. Problem is the lady's want WOOD. He has bought much of my old wide boards in most thickness up to 2". I just bought a load of good diameter tulip for no real reason and could saw lots of wide 5/4 however I have no kiln and every board will get ppb unless sprayed.  Anyhow no new investments at my age and at some point this shelf market will drop dead. Always happens.

[Old Greenhorn]

Moodnacreek, I recently found a kiln up my way (he is an hour west of me) that does other folks lumber only now. He has a HUGE kiln and charges a buck a BF due to his energy costs. DOes good work and pretty timely for me, plus, he is a great guy just around my age with a lot to share. He does regular monthly loads that get trucked to his kiln from Long Island. If you have a trucker, you could probably work something out. If you want to run up this way, I can arrange a meeting, or give you his contact info. He just did some 12/4 x 24 by 16' slabs for us and pretty quick too, I thought.
 (Disclaimer, I have no financial interest in this.)

[Southside]

My weekly sales on the food side of the business range from 10-15% food stamps right now.  

That light at the end of the tunnel is a train. 

[SawyerTed]

I found Yellowhammer a F-350 Super Duty.  There's 40,000 new Ford trucks in Kentucky.

https://youtu.be/hUATiCmxzcQ

[longtime lurker]

I just believe  there are a lot of sawmills out there that folks purchased for a lot of wrong reasons . Also a lot of poor lumber and slabs are just sitting and going unused. As interest rates rise the economy is going to slow at some rate. If $$ gets tight a lot of used mills will be for sale. I also am of the opinion that a lot of interest in mills was driven by you tube videos at I time when guys had a lot of extra time and $$. It looks really easy on a video to make some lumber and build your dream cabin. The reality is that you need a lot of support equipment and milling is hard work.

War story time... ;D ;D ;D
Guy comes in here a couple months back and he wants me to saw some Queensland Maple for him on shares. Now Qld Maple is one of the worlds better cabinet and joinery species and it's got a limited range most of which is now locked up and protected and I cut every bit of it I can get hold of. But one of the anomalies of the lumber game is that scarcity does not always result in a price increase... you need volume to drive a trend and if volumes are constrained the wholesale guys dont push it, the architects don't spec it, and Suzy Homeowner doesn't know it exists to want it for her new kitchen. But I'll still cut and hold because I have a better clientele than that and I can turn it into bucks easy enough.


Anyway, the guy's got a load of logs and they aren't bad logs, and he wants me to saw them on shares:
Me: "Okayyyy, what are you thinking here old mate?"
Dude: "Well I've got some trees and you come cut them down and put them through your mill and we split the timber"
Me: "How about if you want some of it cut I'll contract saw a couple up at my normal rate and just buy the balance of the logs from you?"
Dude: "What's wrong with just doing it on shares?"
Me: "Not a lot, it's just that I've got 20 years experience and a million dollars tied up in the industry, and you've got a couple  of trees. What kind of split you thinking here?"


Despite how it looks in the tube videos it's work, and most people don't like work. There'll be a glut of lightly used mills on the market soon enough

[Tom K]

Basically, I was ready to spend a quarter million bucks yesterday and all I came home with was a headache and a $20 chicken finger combo with cheese bites from Zaby's.


I'm ready for it to be over.

No offence to Yellow Hammer, but this is exactly what I was saying. There are a lot of people/businesses in the same position as him right now. They have the money to spend but can't find something to spend it on since there's nothing in stock.

Not being political, but the government pumping trillions of dollars into the economy is the main cause. All of those dollars need to land somewhere, and then the price structure needs to correct from there. This will take some time.

I've heard rumors of Ford cutting back on some fleet purchases. Some big construction companies that usually order 50-70 trucks (250's-550's) a year are being told they will only get 15-20 trucks next year. These trucks get used and abused and just get worn out eventually. They aren't the pavement princesses most of the suburbanites think they need to drive. This goes on for a couple years and we have issues. Most of these fleets run pretty much bare bones trucks. You would think they would be more readily available then high trim models due to less chips needed, but they are not being built because there is more profit in the high trim models.

[customsawyer]

So many of those same companies buying fleets of trucks, are in the "spend it or lose it" situation. They are going to be looking for something to spend it on.
One thing I have learned in my 29 years of owning a business, is that we are basically penalized for saving money. If you spend it and kick the "tax can" down the road then it makes the economy look better. This gives some folks in office something to brag about, even if it is a false reading.    

[Tom K]

Agree. We run into the same thing with the farm. Either you spend some profit and write it off, or pay 30% tax on it.

Those truck dollars will float around and land somewhere that there is something in stock.

[taylorsmissbeehaven]

I agree with you Tom. I drive 250 and 350's cause I pull equipment and materials around most days. I could get a 4wd bare bones truck in the 30k range. Now everybody needs a truck like that to pull the side by side to the farm on the weekend and expect the trucks interior to match that of the sedan they drive during the week. Even before the pandemic it was getting hard to buy a work truck. Now its impossible. How did folks ever get along before there seats were heated??

[YellowHammer]

Yeah, it's kind of frustrating, and certainly no offense to me.  Me buying high end equipment is what I like to do.  I used to not be able to buy a pot to you know what in, so now I want to buy what I want to buy.  We save up for it, and now, now bueno.      

We save up for routine business purchases, try to plan things out, and then the plan goes in the toilet.  For example, the reason I'm wanting a new truck is that we had planned on replacing my older Chevy, 150,000 miles, when it started to become unreliable.  So it is now, and I need a new truck, no big deal, I have the money, it's in the business plan, and you'd think, somewhere in this country there would be one.  So I started looking at late model used uses and they cost more than than the new ones, the one that sticks out is the used one cost $26,000 more than the used one, at a dealer about 15 miles away.  So then I start looking at new ones and they won't be available for 6 months or more.  Even if I order one in October, Ford won't even start building them until January, and then it's 3 to 6 months, so realistically, it may be 9 months, before I can get the one I want.  So now I'm driving around in an unreliable truck until I can find a solution, and every thousand bucks I have to invest in repairs could have been put into a new one, so is a waste.

It used to be that I could walk into a dealership and buy the the high end models because no one else could afford to wanted them.  So I get a better truck quicker.  I also got extremely high resell on the high end equipment, much better than barebones stuff.

When I went to the Chevy dealership, they didn't even come out to talk to me, which was unusual.  So I asked the manager why and he said they hardly had any salesmen left.  They didn't have any stock so can't sell stuff, so the salesman don't make commissions and move on.


Also, I see rolling stock as an excellent investment.  Good high end equipment doesn't lose value these days, it stays the same or goes up.  So spending money that I can get back is not an issue.  Don't forget how much money we made selling all our old equipment this year.  If I can buy a high end truck, use it for a year, and resell it for as much or more than I paid for it, that's easy money.  But the plan falls apart when I can't get the replacement.

If my truck isn't as comfortable as my tractor or skid steer, I don't want it, and it sure won't be more expensive.  The tractor I bought in 2014 cost more than the Ford Platinum truck I'm looking at now.  I've worked hard for years, and the reality is that I spend $20 grand a week on logs or lumber, sometimes more, sometimes less, so the numbers for a new high dollar ride aren't that big, especially compared to the equipment and stuff.  My LT70 wasn't cheap and doesn't even come with a heated seat!        

[taylorsmissbeehaven]

No heated seat on the lt 70, whats this world coming too?? It is a shame that my ctl is more comfortable than my daily driver. Then again maybe its for the best considering the terrain difference between the two.  :D These are odd times we are living in. Gotta sit back and see how this all plays out.