Lumber Prices Rise, Rain in Atlanta and Athens, Georgia Grind Other Building Materials Prices Lower

Increased housing starts in August combined with thin field inventories drove lumber prices up. Delivery to jobsites was hampered in Georgia, especially in the Athens - Atlanta area.
CME lumber ends higher on firmer cash
'A midweek upswing in sales of Western S-P-F sparked the market. Wholesalers took cautious long positions and distributors more confidently replenished,' Random Lengths said.
Mills continue to shut down or curtail production, but that seem to give little support to other building materials. OSB and plywood mills still have some order files, but are under pressure from a lack of buying at secondary levels. Upward pressure on panel prices could result from any development of tropical activity in the Atlantic.
Tropical Storm "Grace" forming?
After a week-long quiet spell, the tropics are showing signs of life as a large area of low pressure takes shape in the central Atlantic.

Residential Construction and Mortgage Applications Increase, New Plywood Plants, Lumber Production Falls

Mortgage applications rise 17% -Random Lengths WoodWire
The Index of Mortgage Applications from the Mortgage Bankers Association increased 17% to a reading of 648 for the week ending September 4.
Western lumber production fell for third straight year -Random Lengths WoodWire
Lumber production at mills in the 12 western states declined for the third consecutive year in 2008
Perfecta Foret plans to open new plywood plants in Quebec
Moscow. Sep 09, 2009. /Lesprom Network/. Start-up company Perfecta Foret plans to open new five-ply glue-laminated plywood plants in two former lumber mills in Quebec. The company received $C1.2 million in loans from Canada's Regional Growth program to offset costs of refurbishing the former mills, which include Scierie L.B. in Lac-Bouchette and Scierie P.H. Lemay in Saint-Francois-de-Sales. The total investment is expected to reach $C5.7 million.
Construction spending down 0.2% in July; 3-4% further drop expected through Winter -Reed Construction Data
Offsetting the residential gains, the decline is accelerating in nonresidential markets.
Single family market expanding slowly; multifamily market shrinking rapidly -Reed Construction Data
Residential construction spending is forecast to jump 18% from the end of 2009 to the end of 2010.

US Lumber and Log Exports Up, 2008 Home Sales Report for Atlanta

West Coast's log, lumber exports increase in second quarter of 2009
Log exports for the second quarter of 2009 from Oregon and Washington totaled 189.5 million board feet, up 38.6 percent from the first quarter volume of 136.7 million board feet.
A total of 239.5 million board feet of softwood logs and 80.2 million board feet of softwood lumber was exported from Washington, Oregon, northern California, and Alaska in April, May, and June of this year, according to the U.S. Forest Service's Pacific Northwest Research Station.
Atlanta Home Sales Report
Home sales overview by county for Atlanta 2007-2008
Gwinnett 2008 10,467 units -31.30% from 2007.

Atlanta Area's Gwinnett Habitat for Humanity constructs 100th home

Building hope: Habitat for Humanity constructs 100th home
Here at Cofer/Adams Building Supply Center, we are proud to say that we had a part in helping Habitat For Humanity build their 100th American Dream in Gwinnett County. We supplied the lumber, building materials and engineered wood that went in to making the world a better place.

Cofer Adams Building Center, Inc. is a full service builders supply of structural and related building products for residential new construction in the Atlanta – Athens Georgia area. We provide prefabricated components, including floor trusses, roof trusses, and engineered wood; wood and vinyl windows; and pre-hung interior and exterior doors, as well as assemble and distribute interior and exterior door units. We also offer lumber and wood sheet goods including dimensional lumber, plywood, and oriented strand board products used in on-site house and commercial framing; millwork products, which consist of interior trim, exterior trim, columns, and posts; and other building products that include gypsum, roofing, and insulation.
http://www.coferadams.com/ http://www.coferadams.net/

July New Residential Construction Commentary

The above graph is a visual representation of the Seasonally Adjusted New Residential Construction & Sales data through July 2009. The lines represent Total Permits and Starts, Single Family Permits and Starts, Single Family Units Sold, Total Under Construction and Single Family Under Construction. The trend line represents a 50 year regression analysis of Single Family Starts. It is worth noting that there have been several construction downturns since 1959, and that we have surpassed levels that have triggered recovery in all of the past housing downturns.




Looking at Single Family Starts and Permits, we see that the inflection point occurred somewhere between January and March of 2009. We did not see a significant increase in the Atlanta – Athens area until later in the spring. Lumber and Panel prices have risen above the lows that were at or below sustainable levels, although lumber, plywood, and OSB mills continue to curtail or shut down completely.

The quantity of Single Family Homes for Sale is the lowest it has been since April, 1993.
“The median sales price of new houses sold in July 2009 was $210,100; the average sales price was $269,200. The seasonally adjusted estimate of new houses for sale at the end of July was 271,000. This represents a supply of 7.5 months at the current sales rate.” Source: U.S. Census Bureau, NEW RESIDENTIAL SALES IN JULY 2009.
As the supply of new homes continues to drop, new homes will need to be built to replenish the supply. This will require new jobs to be added in the construction industry, which should help lower unemployment, and contribute to a new cycle of prosperity in our U.S. economy.

Capacity for single family residential construction has fallen as builders, building material product suppliers, and lumber and panel mills downsized or shutdown completely. This is good news for any lumber mill, lumber yard, building material supply, and builder left standing in the market.

Reid Adams
http://www.coferadams.com/
Cofer Adams Building Center, Inc. is a full service building material supply of structural and related building products for residential new construction in the Atlanta – Athens Georgia area. We provide prefabricated components, including floor trusses, roof trusses, and engineered wood; wood and vinyl windows; and pre-hung interior and exterior doors, as well as assemble and distributes interior and exterior door units. We also offer lumber and wood sheet goods comprising dimensional lumber, plywood, and oriented strand board products used in on-site house and commercial framing; millwork products, which consist of interior trim, exterior trim, columns, and posts; and other building products that include gypsum, roofing, and insulation.

Lumber Prices Mixed, Homebuilder names partner-winners

DJ CME Lumber Review: Position Rolling Leaves Prices Mixed
Chicago Mercantile Exchange lumber futures settled mixed Friday in moderate to heavy trading that centered mostly on moving trade positions out of September and into other months.
The September contract settled up $1.30 per 1,000 board feet at $174.10, while November was down $5.50 at $177.50 for a 3.01% loss in value. January was off $4.00, or 1.98%, at $198.00.

David Weekley names partner-winners
The winners are Boise Engineered Wood Products, Dow Chemical, DuPont Building Innovations, Eaton Corp., GAF-Elk, James Hardie, Lennox Industries, Office Depot, MASCO Builder Cabinet Group, Seacoast Supply and Schneider Electric.
-David Weekley builds new homes in the Atlanta - Athens, Georgia area.

www.coferadams.com Cofer Adams Building Center, Inc. is a full service building material supply of structural and related building products for residential new construction in the Atlanta – Athens Georgia area. We provide prefabricated components, including floor trusses, roof trusses, and engineered wood; wood and vinyl windows; and pre-hung interior and exterior doors, as well as assemble and distributes interior and exterior door units. We also offer lumber and wood sheet goods comprising dimensional lumber, plywood, and oriented strand board products used in on-site house and commercial framing; millwork products, which consist of interior trim, exterior trim, columns, and posts; and other building products that include gypsum, roofing, and insulation.

5 Major Risks to Green Building Market Growth

The growth of the green building market has been widely celebrated recently, spurred largely by government policies and rising recognition that such structures are more economical to operate. The forces behind the industry are so strong now that research firm McGraw-Hill Construction predicts green buildings will represent 20-25 percent of new commercial and institutional construction starts by 2013, from about 10-12 percent today.

But while the benefits of designing buildings to use energy, water and other natural resources more efficiently are clear, that doesn’t mean the industry’s growth is free from risk. A number of hurdles will need to be overcome in the coming years that, if not corrected, could significantly slow the market.

In a nutshell, the five major risks are:
1. Financial
2. Legal
3. Green-washed Building Materials
4. Driving Energy Retrofits
5. Regulatory Risk

Here in Georgia, construction costs are a primary driver of affordability. When the costs of lumber, plywood, OSB, engineered wood, doors, windows and roofing increase, the ability to finance and sell a home decrease. For example, while the use of composite wood decking makes sense in the long run, most people opt for less expensive treated lumber when building outdoor structures. -Reid Adams www.coferadams.com

October New Residential Construction Commentary

The above graph is a visual representation of the Seasonally Adjusted New Residential Construction & Sales data through October 2008. The lines represent Total Permits and Starts, Single Family Permits and Starts, Single Family Units Sold, Total Under Construction and Single Family Under Construction. It is worth noting that there have been several construction downturns since 1959, and that we are at levels that have triggered recovery in all of the past housing downturns.

Looking at Starts only, we see that Total Starts are the lowest they have been before beginning recovery, and Single Family starts are within a few thousand units of the lowest they have been before beginning to recover. Based on the permits we have see in the Atlanta area, November may give us new lows for all aspects of residential construction. Lumber and Panel prices are at or below sustainable levels, with many lumber items at multi-decade lows.

There are several unknowns at this point. Although the quantity of Single Family Homes for Sale is the lowest it has been since May, 2004, there is a 9.1 month supply available. Our economy is probably in a recession, and people don't tend to think about buying a home during a recession.

Capacity for single family residential construction continues to fall as builders, building material product suppliers, and lumber and panel mills continue to downsize or shutdown completely.