International WOOD MARKETS Group has released its latest report, which offers data regarding the future growth of the moulding market in 2010. U.S. Moulding Market Outlook 2010 – 2014, has been based on WOOD MARKETS’ 20 years of involvement in the clear pine lumber and moulding sectors.

Total moulding consumption in 2009 is projected to drop by roughly 20 percent from 2008 due to the continued collapse in housing starts and residential remodeling, according to the report. When 2007 and 2008 consumption declines are added to 2009, the total consumption decrease is about 50 percent less than the peak volume achieved in 2006.

“Despite the dramatic number of domestic and offshore plant closures and curtailments in recent years, moulding producers simply could not reduce their capacity fast enough to prevent prices from falling to below break-even for extended periods in 2008/2009,” says vice president, Peter Butzelaar, the principal report author. “With U.S. producers having absorbed significant consolidation prior to 2007, most of the recent capacity reductions have fallen on the shoulders of offshore producers.”

The forecast for 2010 to 2014 calls for housing starts and repair and remodeling usage to show slow but steady growth, translating into a modest 5 percent increase in total moulding demand but a 10 percent increase in the average annul price of finger-joint mouldings. Given that the majority of imported softwood mouldings are finger-joint, and since finger-joint moulding consumption is linked closely to usage by new home builders, the WOOD MARKETS forecast anticipates that offshore producers will enjoy rebounding volumes and price gains as the recovery in the housing market takes hold.

“However, due to the reluctance of companies to risk cash flow on replenishing depleted inventories, we are predicting periodic supply chain shortages and unusually erratic price spikes in 2010,” says Butzelaar. “Moving out to 2011 and beyond, our forecast assumes that moulding demand and prices will move even higher as the U.S economy and housing market starts to accelerate into full gear.”

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