US Hardwood Veneer Industry Declining?

[jrdwyer]

I just found out today that Evansville Veneer (part of Kimball International) is shutting down its veneer operations and laying off 150 employees. It's sad that a good employer with a long stable history is closing up shop. It is even more surprising considering that the current plant was just opened in 2000 and had all the latest and greatest Capital slicers and other such gear.
 
So does anyone know if the US Hardwood Veneer industry is in a state of decline or is this just a company specific occurance?

And is all of this related to the loss of US furniture manufacturing capacity over the last 5 years and the subsequent drop in demand for hardwood veneer? I assume that Chinese furniture manufacturers have purchased their own slicers and they sure seem to be buying a lot of US logs.

[Ron Wenrich]

Furniture production has been swinging over to China for the past several years.  There are plants over there that dwarf our plants, and their technology is probably better.

Over the past several decades, I've seen the size of veneer continue its steady decline in size and quality.  Logs that buyers would turn their noses up at just 20 years ago are put on trucks and shipped out.

With the increase in veneer values, growing stock was quickly removed and the potential veneer supply was reduced.  I see it come in on log trucks every day.  

I think there are a couple of things going on.  There is a lack of supply, for one thing.  Some veneer companies are now buying lumber instead of logs.   Would they be buying lumber if there was a sufficient log supply?

Demand seems to be running good.  Chinese offer one market, but the Europeans are also primary players.  With our weak dollar, I'm sure those veneer logs have been greatly cheapened on the world market.  The strong Euro means they can pay more for our logs than we can.  

I haven't heard of any great crush on US industry.  It may be an internal thing or a supply thing or a market thing.  Industry will quickly close shop if the rate of return is too low.