Category’s future remains steady
Cautious optimism is the buzz phrase here. With economists and officials telling everyone the worst of the recession is over, no one wants to jinx the good-but-not-great news.
“We believe there will be continued improvement in 2010 driven by increases in the residential replacement market,” Buchanan said. “Our estimate is the wood market will be flat to slightly ahead of 2009.”
“Low to nearly no inventory in the distribution pipelines hold the market’s fuel as sales opportunities are sometimes missed due to unavailability right away,” LeDuc explained. “Several months of progressive growth will be required to seriously convince distribution to confidently reinvest in inventory and merchandising.”
To that end, manufacturers predict the most profitable increase for 2011 and 2012. “The next two years will have significant growth in the engineered category for all manufacturers,” Holm said. “This year has seen nominal improvement in new home construction.”
Until other home and building categories gain momentum, will continue to experience much of the same. “The market will remain weak under high unemployment, the foreclosure overhang, and the likely expiration of the homebuyer credit,” Call predicted. “At some point, this will snap back rapidly, as demographics demand an annual housing start rate above 1 million units, but don’t expect that in 2010.”
-Emily Hooper