U.S. moulding consumption poised for a long-awaited market rally.

Improving U.S. Moulding Market Spurring on a Rise in Imports  and Prices

Vancouver, BC — International WOOD MARKETS Group announces the release of the 9th Edition of its acclaimed U.S Clear Pine Lumber & Moulding Market Outlook: 2014- 2018. Industry consolidation as well as closures of moulding manufacturing plants both in North America and in key Southern Hemisphere plantation pine countries is starting to look somewhat constrained as U.S. demand starts to move into higher gear by 2015.
 
After enduring six years of declining demand to less than 50% of 2006’s level, underlying demand in combination with rising housing starts is beginning to emerge. “While the U.S. housing market bottomed out in 2009, the U.S. moulding sector didn’t recover until 2012 and now it is gaining momentum from a strained supply chain,” commented co-author Russell Taylor.

The lead author of the report, Peter Butzelaar spent six months of industry and market research that included discussions with most of the major clear pine lumber and moulding industry players in North America and in the Southern Hemisphere, as well as extensive modelling and forecasting work. Mr. Butzelaar’s overriding conclusion is that a wave of pent-up demand is coming, and with a much tighter supply chain, so are higher clearwood prices. As the labour market and income levels improve, new housing demand and soaring residential repair and remodelling (R&R) activity will drive moulding demand higher. However, due to mill closures, supply chain consolidation, and limited supplies of domestic clear pine fibre, the traditional moulding supply base in North America is forecast to struggle to keep up with demand. As higher prices are forecast, this will allow clear pine lumber and mouldings imports to soar to try and provide a balance to the U.S. market.
 
Some of the critical findings of the report include:

• The supply of clear pine lumber, blocks and blanks within the U.S. is forecast to expand some 20% over the next five years despite the forecast volumes being still less than a third of what they were in the early 1990s, or in the pre “spotted owl” era. “Although the domestic moulding and millwork industry is far smaller less than it once was, the moulding industry will need to become ever more dependent on imported clear pine material, primarily from regions with suitable plantation pine forests, if it is to meet the forecast domestic demand for raw material” stated Mr. Butzelaar.

• U.S. moulding consumption increased by 12% in 2013 on gains attributed to housing starts and a moderate uptick in R&R. Based on a now projected slower rate of growth in 2014 housing activity, WOOD MARKETS is projecting only modest growth in moulding consumption for 2014, but this should be followed by more robust and accelerating growth in the mid to later years of the next five years as the U.S. economic recovery gains momentum.
  
  
• Imports of softwood mouldings continue to gain a larger share of the U.S. moulding market as they climbed to over 40% of total U.S. consumption in 2013 with further increases projected for 2014. As Mr. Butzelaar notes, “the re-emergence of China as one of the top four importing countries of softwood moulding products is creating a lot of interest around whether this is a temporary blip or the start of something much bigger.” Among other things, the report highlights what products the Chinese are bringing in, what species they are consuming, from where they are getting their raw material inputs, and what is the growth potential for Chinese moulding imports over the next five years.
  
  
• The market share for traditional solid lineal pine mouldings is losing ground to alternatives mouldings made from hardwoods, plastics, as well as paint-grade mouldings made from finger-joint or MDF. Paint-grade mouldings dominate the sector and are projected to account for more than 80% of moulding consumption and are expected to continue gaining both volume and market share.

• As Mr. Butzelaar explains, “given WOOD MARKETS’ outlook for rising moulding demand combined with the heavy concentration of supply among the top domestic and offshore producers, we anticipate that moulding producers will continue to have a strong influence on the supply chain dynamics, which should ultimately lead to record level prices in many moulding products.”  

The U.S. Clear Pine Lumber & Moulding Market Outlook report remains the leading source for strategic outlooks on what lies ahead for moulding producers and distributors. The key output of the research is the dramatic change in prices that are expected – they are going to soar at times from strong demand and from a hollowed out supply chain that won’t be able to respond fast enough when surges occur.

This summary provides just some of the critical strategic topics addressed in the just released U.S Clear Pine Lumber &Moulding Market Outlook: 2014- 2018. This 9th Edition report strives to assist senior management to steer the course and capitalize on the coming market opportunities by providing insight, supply/demand outlooks, supporting data, and price forecasts that are not available anywhere else. This report predicts where the market is headed for clear pine lumber and mouldings in both the U.S. and offshore supplying regions over the next five years.

To review a complete table of contents as well as subscription information, please visit our website
(http://www.woodmarkets.com/publication/us-moulding-market-report/u-s-clear-pine-lumber-moulding-market-outlook-2014-2018)