Financial Crisis To Delay Lumber Recovery

The historic downturn in lumber ping to 13.6 billion bd. ft. in 2009. demand will likely extend another That would be the lowest annual volyear until the American financial sys- ume since 1982. Since 2005. output at tem and housing market can be western mills has declined some28Vo, repaired, according to a new lumber supply and demand forecast from Westem Wood Products Association.

According to WWPA, lumber demand is expected to droP l5%o to 44.3 billion bd. ft. this year, then fall another 3Vo to 43 billion bd. ft. in 2009. In just three years, demand for lumber has plummeted by some 20 billion bd. ft. -more than what western mills produced in all of 2005.

Housing starts are forecast to reach just 993,000 in 2008 and decline again to 933900 next year. Since new housing typically accounts for more than 40Vo of annual lumber demand, the more than 507o decline in starts from 2005 has been a body blow to lumber mills.

The volume of lumber used in new home construction is expected to total ll.8 billion bd. ft. in 2008-less than half of the 23.3 billion bd. ft. used just two years earlier.

Production in the West should total almost l4 billion bd. ft. this year, slip- or more than 5 billion bd. ft.

Lumber production in the South is predicted to decline 9Vo to 15.2 billion ft. this year, then fall 2Vo next year.

The demand decline, coupled with unfriendly currency exchange rates and higher transportation costs, is taking its toll on lumber import volumes. Following a l97a decline in 2007, total imports this year are forecast to decrease 21Vo to 14.5 billion bd. ft. A 3.6Vo drop is predicted for 2009.

Harwood Mill To Liquidate

Family-owned Harwood Products, Branscomb. Ca.. has abandoned its four-month search for financing to restart its bankrupt sawmill and will liquidate its assets.

"We're really caught up in the financial times. We couldn't get financing," said Art Harwood, the third generation of his family to run the 58-year-old business.

The mill will be auctioned off to pay Harwood's primary secured creditor. Wells Fargo. which is owed $2.9 million.

Canadian imports, which represent more than 9O7o of the volume of imported lumber, are expected to lose market share. Imports from north of the border should total l3.l billion bd. ft. this year, then fall 37o in2OO9.

Non-Canadian lumber imports, mostly from Europe and Latin America, have also plummeted. Just 1.4 billion bd. ft. is forecast to be imported from non-Canadian destinations in 2008, compared to 3.2 billion bd. ft. shipped to the U.S. in 2005.

The WWPA forecast calls for housing markets and lumber demand to grow in 20 10, but cautions that any recovery will be slow.

Harwood owes another $2.3 million to its 20 largest unsecured creditors.

Crushed by falling demand and stagnant lumber prices, the mill shut down in January and laid off 200 workers, intending to restart when market conditions improved. When thev did not. Harwood filed for

Chapter I I bankruptcy protection in May, hoping to restructure its debt.

Decades ago, a market downturn forced the Harwoods to sell their mill in Willits, Ca., and thousands of acres of timberland. The company had also invested millions in expanding the Branscomb facility's capacity and installing machinery to process smaller logs.

Art Harwood.55. will remain in the industry, as director of the nonprofit foundation he helped found 12 years ago. The Redwood Forest Foundation owns and sustainably harvests 50,000 acres of redwood forest in the region.

TimberTech Expands In West

TimberTech has expanded distribution of its composite decking, railing and fencing in the West through new deals with wholesalers OrePac Building Products, Wilsonville, Or., and International Wood Products, LLC, Clackamas, Or.

OrePac DCs in Denver. Co.. and Salt Lake City, Ut., have distribured TimberTech products in Colorado, Utah and Wyoming. The company will now carry the products in nine DCs, expanding coverage to Alaska, California, Idaho, Oregon and

Washington.

International Wood Products, which has distributed for TimberTech in Oregon and Hawaii since 1997, will now distribute the products in western Washington.

84 Breaks Into Commercial

Looking to expand beyond residential housing, 84 Lumber Co. is diving into the light commercial construction market.

The chain recently bid on several commercial jobs, including an 890unit condominium develonment in Lake Austin. Fl., for which ii will furnish steel studs, insulation, sheathing, drywall, trim and metal trusses.

FSC Certifies Roseburg LVL

Roseburg Forest Products Co.'s engineered wood products plant in Riddle, Or., has been approved to produce Forest Stewardship Council-certified Rigidlam LVL.

Bob Berch, Roseburg's EWP national sales manager, said, "certifying our Rigidlam LVL has been a high priority. Our timberlands in California have been certified since 2000, and we have offered FSC-certified plywood products since that time.

FSC-certified Rigidlam LVL is an important addition to our green product line, which is the largest and most diverse offered in North America today".

As certified by Scientific Certification Systems under registration code SCS-COC-000300, the products are recognized as coming from well-managed forests, which adhere to strict environmental and socioeconomic standards in accordance with FSC principles and criteria.

Rigidlam LVL FSC-certified products are manufactured under the "mixed credit" system. They are used for headers, beams, studs and columns.

Tenon Gets All Of Southwest

Majority owner Tenon is acquiring the remaining 245Vo share of Southwest Moulding Co., Dallas, Tx., for $8.6 million.

New Zealand-based Tenon bought half of the outstanding minority interest from two senior managers on October I , with the balance to be picked up on January I and April 1.

Tenon acquired Sl%o of Southwest in 2005, then bought 24.5Vo in 2OO7 o Use almost anywhere ordinary soews are used Saves time and labor costs

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84 Keeps Piling Up Closures

84 Lumber has closed another 29 locations, bringing its total closures to more than 150 over the last 18 months.

Spokesman Jeff Nobers described most of the closings as "market consolidations" in areas where the chain would continue to operate-sometimes in newer, larger stores.

Twenty locations closed Oct. 20, including Dublin, Ca., as well as yards in Missouri, Pennsylvania, New Jersey, Michigan, Kentucky, Indiana, Alabama, Georgia, Maryland, New York, and South Carolina.

Two week earlier. nine locations closed, including stores in Alabama, Oklahom, Illinois, Louisiana, and a component plant in Indiana.

The closures leave the chain with 5,500 employees at 335 stores and 1l component plants.

ProBuild Buys Centrex Yards

ProBuild Holdings, Denver, Co., has entered Arizona by purchasing the assets of component manufacturer/ lumber distributor CTX Builders Supply from Centex Homes, Dallas, Tx.

CTX Builders Supply operates six distribution and manufacturing plants producing wall panels and roof/floor trusses, primarily serving Centex's operations.

The plants are in Albermarle, N.C.; Plant City, Fl.; Buda and Carrollton, Tx.; Visalia, Ca., and Phoenix, Az.which becomes ProBuild's first in the market.

ProBuild has counted Centex as a major, long-time customer, last year earning the builder's Vendor of the Year Award.

Burned-Out Ace To Rebuild

Orland Ace Hardware, Orland, Ca., was destroyed by an Oct. 13 fire, but the lO0-year-old business will reopen in a temporary location this month.

Owner Ben Pforsick, a former Ace corporate employee, said that corporate officials offered assistance within hours of the $ I .5-million blaze, which destroyed all of the store's merchandise and displays. He bought the business four years ago and plans to rebuild at the same location.

Ironically, the store adjoins the local volunteer fire station. The allvolunteer fire crew battled the flames, which were "rolling heavily inside and out." accordins to assistant fire