Western Lumber Markets Remain Slow

It will take a while longer for the U.S. lumber market to get on the road to recovery, according to a new forecast issued by the Western Wood Products Association.

Following four straight years of record consumption, demand for lumber declined 6Vo in 2006 and is forecast to fall another 7.5Vo to 55.97 billion bd. ft. this year. Looking to 2008, WWPA predicts overall demand will slip 1.SVo before rebounding the following year.

A slower American economy, marked by declines in mortgage banking, real estate and construction, continues to impact lumber markets. These developments have reduced home construction, with housing starts falling almost l3Vo in 2006. WWPA is forecasting another decline in housing for this year, with starts expected to decrease l6Vo to 1.5 million before rising modestly to 1.56 million in 2008.

Western mills have cut back Production in the face of lower demand. Western lumber output, which fell 7 .5Vo in 2006, should decline again this year to 16.6 billion bd. ft., down l7o. ln 2008. western output is expected to be off a modest l.2%o to 16.4 billion bd. ft. next year.

Mills in the coast areas of Oregon and Washington will fare better than other western mills. Coast production, off 6.37o in 2006, is forecast to decline 5.87a to 10.2 billion bd. ft. this year. For 2008, coast mill production should be close to 2OO1 volumes.

Inland region mills, located in eastern Oregon, eastern Washington and other western states, are reducing production at a faster pace. After an8.57o drop in 2006, Inland mills will fall almost 97o to 5.6 billion bd. ft. this year. Next year, WWPA is forecasting Inland production to decline to 5.5 billion bd. ft.

Production in the California redwood region will experience the steepest declines, with volumes totaling just 800 million bd. ft. by 2008afmost 257olower than 2005 totals.

Southern pine production surpassed western output for the first time in 2006 and the gap is exPected to widen this year. Production in the South willtotal 17.5 billion bd. ft. this vear and dip to 17.3 billion bd. ft.

Canadian lumber imports are expected to drop below 20 billion bd. ft. for the first time in three years, decreasing to 18.8 billion bd. ft. this year and slipping a modest l.4Vo in 2008 to 18.5 billion bd. ft.

European mills, hampered by low prices and exchange rate differences, will continue to pull out of the U.S. market, according to the WWPA forecast. Shipments from Europe fell l8.8Vo last year and should drop another 247a in 2O07 to 1.2 billion bd. ft. Next year, European imports are forecast at just l.l billion bd. ft.

Development For Former Mill

Bruce Daucsavage, president of Ochoco Lumber, wants to transform the company's 76-acre mill site in Prineville, Or., into a local shopping destination.

"We're ready to dig," he said. "The only risk is letting it sit empty."

The mill closed in 2000.

He said that construction could begin within a year on the first phase of the $20-million project, which would include a mix of retail and office space.

SBS Acquires Polar SupPly

Spenard Builders Supply, Anchorage, Ak., has acquired three-unit Alaskan distributor Polar Supply Co.

Polar Supply, which specializes in commercial grade structural, geotechnical, environmental and corrosion prevention products, will operate as a division of SBS.

Each of its three DC's-Anchorage, Fairbanks and Kenai-will operate as a separate division within Spenard, focusing on major commercial contractors, pipeline and oil companies. Plans are underway to relocate Polar's Kenai operation to a site adjacent to the SBS Kenai Millwork

Center.

"Polar Supply Company has a great group of people who specialize in and understand the products required to build and maintain roads, bridges and pipelines," said SBS president Ed Waite. "This acquisition adds important additional capabilities to our commercial product offerings."

Don Dunavant, owner and founder of Polar Supply, will facilitate the transition before retiring. He grew the business from a one-man operation delivering materials out of his garage in 1986 to a three-location chain with more than 40 employees.

A division of Pro-Build, SBS is