Construction slowdown puts Arizona lumber firms on skids
PRESCOTT – In 2005, demand for mantlepieces, timbers and decorative wood braces had Joe Agosta's wood mill, Woodlife Pine Lumber Sales Inc., turning away business.
Now a staff of eight has shrunk to three, and Agosta relies on smaller remodeling projects and the occasional hobbyists instead of contractors for business.
"There's been a lot of culling out," Agosta said about the recent downturn.
Across Arizona, anyone working in the wood business, from small mills like Agosta's to larger lumberyards, has seen business drop because of the housing market collapse.
"Things are slower than they've ever been," said Glenn Thompson, a salesman for Heldt Lumber Co. in Phoenix.
For Thompson's company, remodeling or do-it-yourself projects are now the bulk of business; even people with money are upgrading their current houses instead of building, he said.
Lagging demand made 2009 the worst year for lumber in the western U.S. since the 1940s, according to a report by the Western Wood Products Association, a softwood lumber trade group.
Last year the region's lumber industry produced 10.4 billion board feet valued at $2.6 billion, down from 19.4 billion board feet worth $7.6 billion in 2005, the report said.
Sam Hauert, owner of Grant Road Lumber Co. in Tucson, said his sales have dropped dramatically in recent years. He estimated that prices are down at least 25 percent from 2005.
Like others, he relies on remodeling but said even that isn't what it once was.
"I don't see much hope for the next year," Hauert said, "Maybe after that – if we are still around."
Arnold Salazar, manager of Superior Lumber Yard in Superior, said that signs of recovery remain elusive.
"I don't see it – at least not in the housing industry," Salazar said.
Preliminary 2010 numbers for the western U.S. show that lumber production is up 3 percent over last year, but the industry still has a couple rough years ahead before production approaches pre-collapse levels, said Robert Bernhardt, spokesman for Western Wood Products Association.
Agosta said he's optimistic about recovery, but added that it's going to be a long time before business is near where it was.
"Nothing has legs on it," Agosta said.