Log Prices?

[Nebraska]

That stinks, I'm sure the hurricane damage is going to cause a hole in the market for a generation or two of landowners.  The barrel stave issue goes hand in hand with the fact that nice whisky is a nicety not necessity.  Got to buy groceries, the truck needs fuel etc.  I hope it will get better. 

[ehp]

So what is going on with log prices these days , here hard maple is down abit  where pretty much the rest is about the same , walnut is down abit as well , white oak is the same , red oak also paying the same , soft maple is up abit

[dnash]

So what is going on with log prices these days , here hard maple is down abit  where pretty much the rest is about the same , walnut is down abit as well , white oak is the same , red oak also paying the same , soft maple is up abit

I'm guessing it might be a bit worse for us come Wednesday morning...

[barbender]

What am I missing?

[dnash]

25% Tariffs are supposed to start Tuesday. From what I understand, enough of our lumber crosses the border that there will be some pain felt. I hope there's some sort of deal to be made beforehand though and we won't have to worry about it.

[TreefarmerNN]

I think there's going to be a little pain and then some serious negotiations to settle the various issues.  I'll be surprised if the tariffs don't get imposed and  equally surprised if they aren't lifted in a month or two.  But there's going to be some market distortion until they are lifted.  Unfortunately, that always means pain at the start of the supply chain.  Sometimes, that is the area that is least able to stand stress and it's really going to hurt some folks. 

[Ron Wenrich]

A strong dollar means our export products are more expensive overseas.  That can put a dent in demand.

The tariffs will also impact softwood markets.  Might put a dent in housing affordability. 

[nativewolf]

So what is going on with log prices these days , here hard maple is down abit  where pretty much the rest is about the same , walnut is down abit as well , white oak is the same , red oak also paying the same , soft maple is up abit

In the central east coast nothing is good.  Can't speak to walnut but the oaks are all down 20% from 2 years ago, white, northern red, southern red, black oaks.  Industrial is about the same as 2 years ago, a bit lower. Yellow poplar has been persistently weak.  We're shocked at how far some loggers are going to ship logs to get $650/thousand doyle on prime YP butt logs. Because local mills were paying $550. The same log will fetch $750 southern PA but that seems to be the current top end.  That is same as it was 8 years ago except we've had giant inflation in 8 years.  

Can't speak to hard maple but I hear it recovered from it's slump and I think EHPs HM market is different due to his super wood quality on the sandy counties he works in. 

Once you leave very good saw logs (3 side to prime) prices plummet. The low grade market is not good.  

Some tie mills are dealing with quotas. 

Pine
Southern yellow pine in Central VA has become a fools dream, most of it seems to be going under the knife to be turned into solar facilities and at $2k/acre for a lease I can see why.   Maybe pulling 30k acres of pine from supply will help prices a bit but I doubt it.  Possibility of another pine mill closing here in VA.  Founder of ResourceWise discussed the absolute glut of pine fiber in the USA compared to Europe; we have an issue here in the states with just too much supply.

Tariff & Dollar
I think Canada hardwoods will do better as a result of the export tariff spat, lumber will be sent from Canada to China and Europe at a preferential rate. If you are a European buyer the certainty alone will be worth some premium.

A strengthening USA dollar is also going to hurt exports compared to Canada, southern Europe, Africa, Australia, or Latin America.  

The American Hardwood Lumber Association is going to have it's work cut out for them; you can look up the old press releases from the last tariff war with China- it got ugly very quickly. This year we are getting hiring inquiries from top executives- they are shopping their resume because they expect their operations to be closed by owners.  I was shocked at one name.   

Housing
That said USA housing start improvements would counter any negatives.  The lack of affordable homes is an issue but there is very little wood left in these homes- vinyl siding, vinyl flooring, fake wood cabinets, vinyl molding. If the conservation non profits and global warming advocates want to do something that is good for the planet they'd find a way to credit a homebuilder for using wood. Wood is good.  Good for the planet and good for rural jobs, the move to vinyl not only is terrible for greenhouse gas emissions but strips rural jobs.   We need to see housing starts on custom  homes and we need to see custom homes sales increase.  There is a rising # of large high end homes on the market- especially in the sunbelt.   That's a bit worrying.   Builders need those to move before starting more.  There are almost none in the mid-atlantic or upper midwest and maybe we'll see some starts there. 

Fires in California may impact the west coast markets but I can't comment.  

[ehp]

For here right now things are slow as not to many mills left but lots of loggers so mill can choose whom they buy from , good bush just let stand until markets come back if they ever will, now we will see what happens to veneer market as most goes to the USA so may have to change that . Here cut big hardwood and unless its veneer send it for timber logs cause it pays better than grade 

[SwampDonkey]

I wouldn't count on us moving any extra lumber to Europe of any significance. Theirs is coming this way because of ongoing disputes , moreso with softwood. The fastest growing marking for Canada wood products has been the Philippines New Zealand and Italy. Still not $Billions. But by far, most is traded with the US. Next is Japan, then the UK. We bring in wood products from other European countries that buy not much from us at all.

[Ron Wenrich]

If I recall the tariffs from back in the Bush days, the story goes that Canadian lumber was sold to the Europeans, then sold to the US without the tariff on Canadian lumber.  It was basically a bookkeeping matter.  The lumber may have been put on ships, but the ships never made it to Europe.  Whether its true or not, I don't know.

A current report is that some Canadian businesses are looking to put production into the US.  Tax avoidance could become a larger business.

[SwampDonkey]

I don't buy it on the lumber end. But I do know for a fact that oil on freighters is bought and sold many times before it reaches port. In the 1970's the Irvings were in the hot seat over it. In the end they prevailed because nobody touches king Irving. They have no public shareholders. 

Already have a handful of Canadian mills in the US, and I think one in the SE may have recently closed. And it was fairly new. Irving has moved mills from NB into Maine. Gov over there made sure the rail was maintained, mostly used by the Irvings, they can move planer chips and lumber from St Leonard, NB from that mill, cross into Maine around Madawaska, Maine, pick up lumber and chips in Ashland, Maine. Divert the lumber down through the US and the chips onto to their St John, NB pulp mill. The Irvings have always gotten better deals on lumber tariffs. Irving bought up a mill next door to their Ashland, Maine mill and for now are running it. But if history repeats, they did a lot of that in NB and closed them down in less than 10 years. They don't need two big saw mills in the Allagash watershed, so someone will eventually be looking for work.

[leeroyjd]

Does Canada export raw logs to the United States? Someone had this on their list of Canadian exports and I had never heard of that.

[SwampDonkey]

NB has always sent some logs off private land in times where the price was better than from NB mills.

[TreefarmerNN]

If I recall the tariffs from back in the Bush days, the story goes that Canadian lumber was sold to the Europeans, then sold to the US without the tariff on Canadian lumber.  It was basically a bookkeeping matter.  The lumber may have been put on ships, but the ships never made it to Europe.  Whether its true or not, I don't know.

A current report is that some Canadian businesses are looking to put production into the US.  Tax avoidance could become a larger business.

Several Canadian lumber companies have already bought or built plants in the US.

[Southside]

Well that all blew over quickly....

[nativewolf]

If only log prices would blow higher quickly.   Baillies is about to idle a huge mill in PA, they had record sales to China pre trump and this month sales stopped.  The weather has the log yard empty and I'd hoped they would increase log prices but instead are going to stop sawing until the yard has a few weeks of logs; they do 100k bdft a day which is pretty serious in hardwoods in mid-atlantic.  Automated bin sorting mill.  

Nothing moving yet.

Pete Stewart - CEO of Resource Wise did a piece on potential impacts of Canadian tariffs on the USA log prices.  He predicted it would only increase Doug Fir and would lead to increased sales of European fir to the USA.  Apparently he doesn't see any help for the glut of loblolly plantation pine logs in the SE.  

[ehp]

Have not sold any hard maple veneer yet but have some to go, hard maple saw logs are down abit this week and this maple is not huge but fairly nice , its very white and heart the size of a pencil dot , everything else stayed the same 

[RookieLogger]

Here in SE Pa prices are holding pretty steady. Mills are paying close to $3 for WO prime. Export market is well above that. Poplar holding around 60 cents for prime logs. Export might pay 70 or well above that if you have white Poplar. Everything else I try to push to Mat logs. Stella Jones just shut down a big tie mill in Juanita County so that is going to make things interesting in the low-grade market, probably not in a good way. Weaber lumber a big buyer of Poplar and RO isn't paying their log suppliers in our area, I know of multiple guys waiting almost 60 days for log checks with no answer as to when then money will come. Picture of a "white" Poplar from the job we're on, note the large band around the heart

[TreefarmerNN]

I clicked "like" on RookieLogger's post but I really don't like it.  Anytime you have to wait 60 days to get paid on delivered logs, something is badly off.  It's even worse if the mill can't tell you when you will get paid.

I think federal law on interstate livestock sales is something like the check has to go out the door in 48 hours.  That doesn't always happen but it's a big incentive for livestock markets to pay promptly.

[RookieLogger]

I've had smaller Amish mills take a month or better to pay but they always communicate the delay before they take logs in. Weaber doesn't owe me any money so it's not first hand info but I have heard it from several different loggers who sell to them. I am having trouble getting paid for log trucking from multiple different customers, which hasn't been a problem until a few months ago. Seems like around our area money got tight towards the end of last year 

[SwampDonkey]

I remember some mills up here going weeks before payment, this was over 30 years ago. The biggest landowner and mill owner was the least prompt. It wasn't that they never had the money, it was a game they were playing against woodlot organizations. They've never gone broke since they started.

[nativewolf]

If Weabor has money issues it could be the banks finally cut them off, but I understand a couple of banks have huge lines out with them.  Weabor is a bit outfit and lets all cross fingers they get it sorted out. 

Was the Stella plant just a treatment plant or did they actually saw? 

Mat logs are often a better choice, for sure.  

Sadly this is about what I expected, the last term you had Northwest and AWP go under (though AWP struggled on for a couple of years they too stopped paying folks promptly and in the end bank fraud suits are flying).  25% of the hardwood capacity went first time and I guess it will be about the same.  Sadly, it doesn't have to be this way.  Manufacture great products here and we wouldn't be in this position.  Sell them intelligently, innovate in mills.  Oh well.  

[RookieLogger]

Yes Stella was a treatment facility, the largest in the area I believe. Next would be Koppers who I'm told has already dropped their prices with the incoming glut of ties from Stella closing. Supposedly that's the excuse they are giving about not paying for logs is that they "switched banks" a few months ago and it jammed up their line(s) of credit. That may be the truth but in my opinion it's unfortunate that businesses get to operate that way when they become too big to fail. Back around 2011 or so Weaber sold the business to an outside investment company, guess things got pretty tight leading up to that. They bought back the controlling interest a few years later. It would be a tough blow to the community for them to go under so hopefully they get things worked out 

[Ron Wenrich]

Weaber has always had bouts of cash flow problems.  Holding up payments will only put loggers out of business and hurt them even more.