8-5 IAT Forest and Nursery

 Finishing up the 2nd quarter market snapshot. Every quarter I call Michael Stolp, who is V.P. Market Research and Development for Northwest Farm Credit Services. Last week we covered some of the  more important Idaho crops and today we finish with Forest Products and Nursery/Greenhouse. 

Forest Products -- Industry optimism  faded somewhat from early 2013. Lumber and panel prices dropped sharply in the second quarter of 2013, pressured by over-bought inventories and rising production. Current prices are challenging mills’ margins, with log and product price structures dictating profitability for individual operations. Although log prices by region are mixed, average Northwest log prices are relatively unchanged from the first quarter and 25 to 35 percent higher than a year ago. U.S. housing starts reached a seasonally adjusted annual rate of 914,000 units in May. Although still well below sustainable starts of 1.2 to 1.4 million, the current pace is positive and supports the potential for 1 million housing starts by year end.

Nursery/Greenhouse -- The nursery industry recovery is underway. An informal survey of Northwest FCS’ nursery customers reveals product sales are up nearly nine percent year to date through May 31 compared to May 31, 2012. Additional sales are the result of weather patterns throughout the country that contributed to new sales opportunities. Supply shortages in some plant varieties have created new market options.. Producers could experience profits in 2013 that have eluded them for several years. Most producers are communicating more optimism now than since the downturn began in 2008.