Chew on these stats Kentucky

The USDA Forest Service just released its latest "Bulletin of Hardwood Market Statistics: 2006." This report includes a great deal of useful information on primary and secondary hardwood products, production, prices, international trade and employment. It also includes an overview of recent trends with data during the five-year period from 2001-06.

Here are just a few highlights, some good, some not so good.

For example, the statistics show significant declines in employment for the hardwood industry and hardwood prices have underperformed other commodity groups. One notable exception is the continued growth of the wood kitchen cabinet industry. International trade statistics show that U.S. hardwood log exports have increased significantly, especially to China and Asia, where they use our logs to produce finished wood furniture, flooring, components and related wood products for North American markets. U.S. wood furniture imports reached nearly $17 billion in 2006, of which 75 percent came from Asia and the Pacific Rim.

Other highlights…

• The Producer Price Index (PPI) for hardwood lumber increased 7.7 percent, compared to 12.1 percent for wood kitchen cabinets and 9.9 percent for wood furniture while hardwood dimension prices increased only 4.8 percent. The PPI for hardwood lumber has been declining since 2004 and dropped 0.6 percent in 2006, compared to 2005. However, the PPIs for all other wood product categories increased slightly in 2006 as follows: hardwood dimension (+0.3 percent); wood kitchen cabinets (+2.3 percent); and wood furniture (+2.4 percent). The PPI for all commodity products tracked by the U.S. Department of Labor increased by 4.6 percent during the same period. This means that prices for wood products are not keeping up with the prices of other commodity groups, which partially explains lower profits for our industry.
• The volume of shipments of oak strip flooring increased by 8.3 percent. However, shipments of oak strip flooring dropped from their 2005 peak by 8.4 percent during 2006 due to the decline in housing and increased flooring imports into the United States.
• Employment in all areas of wood production declined during the past five years with the exception of wood kitchen cabinets and countertops. Wood furniture employment continued its slide and had the biggest decline at 38.9 percent, losing 45,000 workers. Wood millwork and flooring employment lost 4,900 workers or 5.8 percent. Wood kitchen cabinet manufacturers gained 28,100 workers, and employment jumped by 18.8 percent.
• The U.S. dollar continued to decline against the currencies of our major hardwood product trading partners. The biggest change was in the decline of the U.S. dollar compared to the Canadian dollar, where the U.S. dollar declined from 1.40 in 2003 to 1.13 in 2006, a drop of 19.3 percent. Recently, the United States and Canadian dollar are valued on par at 1.0. From 2003 to 2006, the U.S. dollar has lost ground on the Euro, dropping 0.89 to 0.80 or 10 percent. Currently, the U.S. dollar is at 0.70 to the Euro. The Chinese Yuan went from 8.23 in 2003 to 7.97 in 2006, a decline of 3.2 percent. Currently, the U.S. dollar is valued at 7.51 to the Yuan.
• Overall, log exports are about the same volume as they were in 2001, but the value of log exports has increased by a whopping 47 percent. Export log volume and value to China have jumped sharply during the five-year period, up 87 percent in volume and 96 percent in value with the greatest increases coming in recent years. U.S. hardwood log exports to Canada in 2005-06 declined significantly, dropping 33.4 percent in volume and 15.4 percent in value.
• In 2006, U.S. hardwood lumber exports totaled 3.1 million cu. m, an increase of 3.3 percent over 2005, and the total value of hardwood lumber exports reached $1.6 billion, an increase of 8.7 percent over 2005.
• The volume of hardwood lumber imports to the United States reached 1.8 million cu. m that were worth $867.5 million in 2006. This represents an increase of 20.5 percent in volume and an increase of 62.5 percent in value from 2001.
• Total value of U.S. wood furniture imports increased sharply during the 2001-06 period. Wood furniture imports increased $6.3 billion during the five-year period, reaching $16.6 billion in 2006, an increase of 60.9 percent.
• In the early 1990s, Taiwan was the leading source of imports; from 1995-99, Canada was the leading source of imports; and from 2000 until today, China is by far the leading source of imported furniture into the United States. Canada ranks second, followed by Vietnam, Malaysia and Indonesia.

Are you full yet?

For more details or to view the entire report, go to http://www.fs.fed.us/ne/princeton/publications/2007.html, then scroll down to publication number 2006, Bulletin of Hardwood Market Statistics: 2006