Demand remains firm for tropical hardwoods in North American markets
Despite a modest slowdown in new orders, the demand for tropical hardwoods remains robust in North American markets, particularly in high-end projects and exterior applications, with supply issues varying across different species and specifications.
Many tropical hardwood importers in the US and Canada indicate sales have been steady in the first half of October compared to September. Others report a modest slowdown in new orders. Most are still experiencing decent outbound shipments due to solid order bookings in late summer.
Tropical hardwoods have typically been most prevalent in high-end projects because they are relatively expensive. That has become even more evident as composite and non-wood products capture larger shares of markets for cabinets, flooring, and other residential applications. At present, importers are experiencing good demand from producers of high-end residential moulding and also from commercial millwork manufacturers. Sales to large and mid-sized residential flooring and stair plants are slow, but business is holding up well with custom flooring and stair makers.
In residential markets, demand for tropical hardwoods for use in exterior applications remains noticeably stronger than for interior applications. For example, tropical hardwood importers report steady sales to outdoor furniture producers, while companies supplying domestic hardwoods to case goods and upholstered furniture manufacturers describe business as weak.
Hardwood supply issues vary, based on species and specification
The overall supply of tropical hardwood lumber at US and Canadian import yards is comparable to overall demand. However, that is definitely not the case across all species, thicknesses, and product specifications. For example, 4/4 Sapele is readily available, but many of the thicker sizes are scarce. Likewise, some contacts indicate flatsawn African Mahogany is difficult to source, while quartersawn material is not. Spanish Cedar from all regions is not abundant, but South American stocks are almost nonexistent in North American warehouses.
Importers of African hardwoods continue to grapple with several issues. First, production at West African sawmills has fallen alongside demand. Second, many containers are being delayed for long periods at the port of Douala, Cameroon – the leading point of egress for hardwood from West Africa. Finally, US authorities are reportedly conducting more inspections on arriving containers, particularly for African Mahogany. One experienced importer of African hardwoods said, “Inventories are in decent shape, but if the supply side issues in Africa continue, that might not be the case in the first quarter of 2024.”
An importer of hardwood lumber and decking from Brazil had a similar assessment. “Supply is enough for current demand, but it is lower than last year, and lower than it would need to be if demand picks up.” Apparently, many Brazilian sawmills are harvesting less than their allowable cuts due to expectations of subpar demand in 2024.