Market Recap: RISI Crow’s Construction Materials Cost Index
A price index of lumber and panels used in actual construction for July 13, 2012
*Western – regional species perimeter foundation; Southern – regional species slab construction.
Crow’s Market Recap — A condensed recap of the market conditions for the major North American softwood lumber and panel products as reported in Crow’s Weekly Market Report.
Lumber: Both mills and secondaries reported "mediocre" SPF lumber trading activity. Much of the inactivity was blamed on the approaching expiration of the July futures contract. Prices in the East were largely sideways, with mills relatively busier selling into the United States than Canada. The Southern Pine lumber market continued to round into better shape, as increased demand chewed through mill inventory buildups and generated order files of two weeks. Buyers purchased greater volumes in response to the appearance of price floors for certain items. Increased demand for both dry and green Coastal species prompted higher prices for many items. Mills reported order files out two weeks or sooner. Buyers found green Doug Fir items harder to source. Inland species lumber markets quieted after midweek. Producers were able to move off excess inventories and build modest order files. Eastern White Pine sales were steady and mills had order files out to the end of the month. Prices were firm. Ponderosa Pine board producers reported decent sales activity early in the week, but sales quieted late. The slower pace was attributed in part to the Inland golf tournament, which took some buyers and sellers away from their desks. Producers of Ponderosa Pine Moulding and Shop continued to struggle to stay ahead of production. While enough sales existed to keep Mldg&Btr prices firm, Shop prices remained vulnerable. Availability of Radiata Pine Shop was very light, as producers concentrated on markets other than North America. A pace closer to the one experienced prior to a muddled mid-week holiday reappeared for many Western Red Cedar producers. Any sluggishness regarding buying activity in particular regions of the United States was generally blamed on extreme heat.
Panels: OSB producers reported light inquiries and lackluster sales. Mill order files were out to the week of July 30, although prompt shipments were also offered by some producers. After mild discounts were used to sell quick shipping volumes early in the Southern Pine plywood market, increased demand helped firm prices and edge some slightly higher. Mills extended their order files out into the weeks of July 23 and 30. Sales activity in the Western Fir plywood market was slow. Some prompt volumes were sold at slight discounts. Buyers purchased Southern Pine at discounts to Western Fir. Although sales volumes were on the light side, Canadian plywood producers were content to wait for the market to come to them, carrying order files out to the end of July or early August. Expected slowing around the July 4 holiday was reported by a few particleboard producers, while other said the market was "steady." MDF sales remained stellar, with no producers indicating any slowing on that front.
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Lowe’s to repair tornado-damaged DC
Lowe’s plans to invest $5 million to repair and expand a flatbed distribution center in Thomasville, N.C., that was damaged by a November tornado, according to an article in The Business Journal of the Greater Triad Journal.
The construction of two new buildings and repair of three existing buildings should be completed by November, according to the project manager. Lowe’s millwork facility, located on the same site, was not damaged by the Nov. 17 tornado.
The new distribution complex will continue to take bulky products such as insulation board, ladders and lumber by rail and transfer them to flatbed trailers for delivery to 160 Lowe’s stores in the Southeast, a company spokeswoman told the newspaper.
Lowe’s operated out of a temporary space after the tornado, which killed two people and caused major damage to the community.
Survey: Small business employees lack proper safety preparedness skills
As extreme heat and possible hurricanes begin to develop across the United States, a recent survey finds employees may not be prepared for disasters or emergencies at work.
The survey, conducted by Staples.com, found that 50% of office workers have either never participated in safety drills or have only done so every few years.
Victor Sordillo, vice president and global technical services manager of loss control services for the Chubb Group of Insurance Cos., said that companies that do not develop sound emergency plans for employees during catastrophic situations are unlikely to be able to swiftly recover and restart business operations.
According to the Institute for Business and Home Safety, roughly one-fourth of businesses do not reopen after a major disaster.
“A major weather event can quickly cause property damage, inaccessibility of a site and loss of power,” Sordillo said. “Without planning, preparation and practice, a company will sustain a much greater loss in the event of an emergency. Each employee should understand the major vulnerabilities and [his or her] role in reducing loss and resuming operations.”
Fires and explosions occur in roughly 70,000 American businesses and cause nearly 200 employee fatalities annually, said Staples.com Public Relations Manager Mark Cautela. In addition, approximately 1,200 tornadoes occur every year in the United States, according to the National Oceanic and Atmospheric Administration (NOAA), and virtually all states have the possibility of experiencing a moderate to severe earthquake.
Cautela said that the most valuable asset that small businesses have is time, including the time that they’re able to stay open.
Typically, the longer a business is closed while recovering from a disaster, the greater the likelihood that its customers go elsewhere. “Even if the business is able to rebuild its physical location and replace its inventory, it may have lost customers in the meantime, who are not likely to return,” he said.
Make a plan, talk about it
Nearly half of the office managers polled said they handled all of the safety-related planning and ordering of products, but whether they are talking about those plans and services with employees is questionable: Seventy percent of managers say their company has an emergency communication plan, but nearly half of office workers are either unsure if such a plan exists or say their company does not have a plan.
Sordillo stressed that a means of communication with staff and emergency services is a necessity and that plans must be established to run the operation at the highest level possible if a facility is inaccessible. He advises businesses to conduct a thorough risk analysis to help reduce their downtime and increase the chances of a successful recovery. This can help executives understand the potential of all risks associated with an operation and allows them to develop a recovery plan.
Cautela said safety strategies need to be put into place to respond to all types of emergencies. “Emergencies can be small or large and can impact few or many employees, but it’s important to be prepared for all scenarios, including minor medical emergencies, power outages and smaller storms,” he said.
Small businesses must take extra precautions
Cautela believes that small businesses have an even greater need to put an emergency plan in place so that they can “protect the lifeblood of their business, their employees, and ensure that they’ll be able to re-open for business as soon as possible.”
In a small business, “sometimes it’s all you: you’re the IT person, the payroll person, the office manager and the salesperson,” he said. Small businesses are often run as sole proprietorships or limited partnerships so there is not as much to fall back on in a disaster situation when it comes to capital resources or human resources, he said.
In addition, small businesses are less likely to have multiple locations where they can temporarily move their operations in the case of an emergency. “A chain of hair salons could conceivably set up some staff temporarily in another location. But if the business is confined to a single location, that business is 100 percent closed,” Cautela said.
There are a number of supplies that experts recommend small businesses have for emergency situations, including first aid kits, fire extinguishers, personal protective equipment, flashlights, surge protectors, equipment to clean up and notify employees of spills, and, if possible, defibrillators.
Managers were almost 50 percent more likely than non-managers to be able to locate these safety-related supplies, suggesting that it is not enough for organizations to simply have these supplies if many office workers are unaware of where they are located.
Both experts agree that planning should extend to the entire business relationship, from suppliers to buyers.
“Businesses should make sure that both their customers and any critical vendors are aware of any disruption in business and that plans are in place to get back up and running as soon as possible,” Cautela said.
Eytan Hirsch is a staff writer for SHRM.
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