U.S. sawmills are getting passed over by Chinese buyers according to recent news articles, which claim China is purchasing an increasing number of logs directly from exporters.
One Tennessee-based sawmill owner, Gerald Storey, said that a few years ago, the Chinese began buying high quality logs directly from exporters at a price well above the “normal” market price. Storey said this activity slowed down for a time, but has now picked up on a grand scale. Storey Sawmill deals primarily in poplar and red oak. It seems that, after talking about his experience with competing sawmills in the Troy, TN area, all agree they are going through the same thing.
Storey said that U.S. mills are going to be forced out of business by U.S. log exporters, and that the Chinese are cutting their costs by illegally receiving logs not decontaminated into the country.
Wood Doctor, Gene Wengert, said Chinese buyers are paying 50% more than what they would pay on average for sawmill logs, an amount that ultimately ends up being about $900 for 1000 bf (board foot). China is the top recipient of U.S. hardwood (red oak, white oak, hickory, cherry) logs, and with increased interest in buying directly from exporters, it could mean even higher lumber prices in an already tight U.S. market, where sawmills are running short on log inventory.
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