This recent article in MSNBC paints a bleak picture for hardwood sawmills due to the decline in the housing industry and the loss of the furniture industry. Prices for lumber are dropping:
“The prices are, they’re where they were 20 years ago,” says Woodyard, who has more than two decades in the business. “To be profitable you’ve got to watch all your P’s and Q’s and eliminate all the fat in the payroll.”
Prices vary by factors such as species and grade, as well as negotiations with buyers, but Woodyard says the price of cabinet-grade lumber has slumped in some cases to $900 for 1,000 board feet. For years that price was $1,200 and at times as much as $1,400.
Another factor has been the change in styles that are now favoring light colored hard maple and poplar over the darker red oak.
Employment in the logging and sawmill industries has dropped dramatically in recent years.
How to survive the changes in the industry is the biggest challenge for sawmills, loggers, and landowners. Urs Buehlmann from Virginia Tech:
… thinks Europe may have a solution. Surviving Western European mills have shifted to made-to-order furniture and cabinet manufacturing. “They’re pretty much customizing the kitchen to your specifications,” he says. “I strongly believe this will be the guide.”
This reminds me of other stories I have heard about organic farmers. They are able to make a profit by producing high quality vegetables and fruits that they sell in farmer’s markets in big cities. The sawmill owners would have to create relationships with home builders and designers in high-income areas of larger cities, but it could certainly pay off.
Another solution that the article mentions is banning log exports, but that brings its own problems.