News & Events

Whatever you do, work at it with all your heart To be honest , To work from heart always.

First rays of spring

The construction-related wood panels, OSB and softwood plywood, have experienced poor demand for over a year. However, upon examining trade statistics from every continent, we observe that monthly shipping volumes have ceased declining and stabilized. In some cases, volumes are slightly improving, particularly with OSB.

Simultaneously, central banks have halted their interest rate increases. In the USA, rates have remained flat since mid-2023, and in Europe, this occurred a bit later. Many businesses would welcome the lower rates to stimulate sluggish demand. Companies eagerly await central banks’ decisions, akin to a drooling dog. On Wednesday, March 20, the Fed kept the interest rate at the current level but announced plans to decrease it in the coming months. Cheaper money should rejuvenate the building sector, although nobody expects an active construction market before 2025.

Over the past 12 months, panel producers have adjusted their production according to current demand. Balancing is difficult, and perfect timing is impossible. It is common to feel that cutting decisions occurred too late. When demand improves, the timing to increase production is equally challenging, but the difference is that things have a positive tone again.

The first sign of improvement arises when sellers notice their lead times lengthening. With a stronger order book, they are emboldened to request higher prices. Spring always arrives after winter at some point. Let’s cheer for that!