Big Tippers

Folklore abounds with stories of Wall Street stock traders and lavish steak dinner lunches. Lumber traders not so much. We’re told that stock traders are sticking closer to their trading desks these days, leaving many of Manhattan’s lunchtime eateries vacant.  Global turbulence in financial markets through the first 60 days of 2016 explains a “re-calibrating” of the Wall Street lunch; the steakhouse slowdown coincided with the S&P 500’s worst-ever start to a year. Even so, it’s reported a recent $1,000 lunch tip left by one regular suggests there are still a few traders seemingly immune to the market’s ups and downs.

In midst of a year without export tax winter, no doubt lumber traders are also spending more noon hours at their desk. Unlike this time last year, when one of the harshest winters on record stifled demand, lumber is even hotter than the weather. It’s reported here that lumber futures is up 22% this month, outperforming stocks, oil, and gold. Out in the field, Random Lengths confirms “producers have kept order files advancing deeper into April” on #2&Btr Western SPF and “moved prices up accordingly”. At the secondary level meanwhile, at least one trader/blogger has characterized activity over the past ten days as “the quietest hot lumber market” in recent memory. With the BC Wildfire Service having just announced early burning restrictions due to dry conditions in the Cariboo, traders will be closely monitoring the day-to-day changing landscape – mostly from their desks.

“There’s nothing like a little bit of a sharp correction to improve our work ethic.”
– John Manley, New York-based chief equity strategist at Wells Fargo Funds Management, which oversees about $233 billion.

wolf of wall street

Lunch scene from “The Wolf of Wall Street”


~Musical Refreshment~

I recently finished recording sax tracks on two more original compositions by Dave Friend for our Funkify album.

Beijing Branding

Vancouver Forest is a unique 900-unit residential development – in Beijing! We’re told here the site was designed to replicate a mini west-side Vancouver neighborhood complete with west-side Vancouver-style housing, landscaping, trees – and bidding wars, presumably. A Google search reveals the plan was hatched in 2002. By 2006, construction had stalled however, when the Chinese government determined single detached homes were not in the collective interest of the country’s more than one billion people. By 2009, construction had resumed, and it’s reported that 900 homes of approximately 4300 square feet each have been completed. According to Business Vancouver, “North American single-family home subdivisions started emerging in China early this century following successful projects such as Orange County, which created a faux Los Angeles an hour’s drive from Beijing.”

So I read with interest a report today in The New York Times. According to the report, this trend of tacking on foreign names to developments around China could be coming to an end. We’re told concern over the foreign names was raised when a recent survey revealed that since 1986, “60,000 township names and 400,000 village names have fallen from use as a result of development and urbanization” in China. The minister of civil affairs has said names that “damage sovereignty and national dignity” or “violate the socialist core values and conventional morality” would be targeted. Meanwhile, developers argue the “international flavor helps sell houses”.

Wood Basics

Earlier this month, Lauren Chimko, lumber trader at Dakeryn Industries, completed the NAWLA Spring Wood Basics Course at Mississippi State University (MSU), in Starkville, Mississippi. In the following guest post, Lauren shares a little bit about her trip and the four-day immersion course which included both classroom training and instructive tours of a number of field operations:

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Visting McShan Lumber Company – McShan, AL

Starkville, Mississippi – home to the MSU Bulldogs.. and not a heck of a lot more. The week of Feb 29th though, I joined over 30 newcomers to the wood products industry who flocked to Starkville to learn about – you guessed it – wood! The curriculum covered a variety of topics surrounding the life of a piece of lumber; from a wee little seedling in a forest to a structural component in a home. Key subjects: forest operations, sawmill production, transportation, and sales/negotiations. As one of those people who loves to learn, I was excited to be back in the classroom. Lectures started at 8am, and frequently included presentations from a number of expert guest speakers. Field trips were a highlight, not to mention the opportunities for networking.

The experts:
Dr. David Jones (MSU) talked everything forest, while Chris Knowles (Oregon State University) discussed the ins and outs of lumber manufacturing and global markets. Rubin Shmulsky (MSU) popped in to review engineered wood products, and took us to the lab to observe some tests. On day two, the class visited Alabama to tour two sawmills – an eye-opening first for many. On day three, resident Transportation & Logistics expert Phil Lower visited. Lectures concluded on the fourth and final day with Scott Olsen (The Olsen Group) on negotiation. Scott – I still want that book!


The attendees:
Our diverse group arrived with backgrounds in sales, purchasing, law, engineering, logistics, and more. We had interns, employees with 20+ years in the wood products industry – and everyone inbetween.
With attendees from all corners of North America, our class had experience with all kinds of different wood species/products. The majority of the group was represented by the Southern States. There were three Canadians in our class, and I was pleased to see a decent representation of women (about 25%).

In a nutshell, Wood Basics is exactly that. A group of people coming together to develop a basic understanding of the products they deal with on a daily basis. If you want to take it up a notch, NAWLA also offers Wood Masters 2016 in Las Vegas (worlds away from Starkville, MS). Thank you to MSU for hosting us, the team at NAWLA (especially Jim, Chris, Erin and Matt), and all the presenters. Thanks also to all of the attendees, for a great week in Starkville.

Lauren will be attending the Montreal Wood Convention (March 21-23) and the COFI Convention in Kelowna (April 6-8).
View Paul Harder's LinkedIn profile View Lauren Chimko’s profile

Lost Art?

Being on the receiving end of a phone call these days can feel like an invasion of privacy, reports The Globe and Mail. But Mary Jane Copps (aka “The Phone Lady”) argues here that business still happens on the phone. In the present ’emoticon era’ however, “phone skills” involve fingers – not voices – meaning graduating students entering the workforce are not prepared for real live phone conversations with clients. According to Copps though, a lack of phone skills isn’t merely a generational failing. Many professionals in the workplace rely on e-mail, leaving their phone skills rusty.

Copps tells us it’s the caller’s responsibility to quickly diffuse the receiver’s defensiveness by avoiding opening lines such as “how are you doing today?” Back in the 90’s, as a green rookie nervously cold-calling forthright lumber buyers in Massachusetts, I certainly learned that rule in a hurry!

Today, email threads have replaced paper trails in Hilroy Notebooks confirming lumber tallies and other details of the order. But the phonecall remains a critical piece. Trading floor atmosphere is conducive to building energy and reading market moods, and interpreting those changes critical to decision-making. Perhaps the number of failed on-line lumber exchanges also reinforces the importance of the telephone. Anyone remember TALPX? Recall the biggest complaint among participating buyers and sellers was that “we always ended up having to pick up the phone anyway”.


Happy Birthday

So what’s to celebrate this week? Harderblog is five years old! What’s changed in five years? Media tell us the world has changed. The lumber business continues to change. Markets change. We’re learning that climate changes.

One of many significant changes captured in the blog archives is the bottoming/gradual recovery of the U.S. housing market. In February 2011, the seasonally-adjusted annual rate of housing starts in the United States was just 518,000 and the Random Lengths Framing Lumber Composite Price averaged $296. Today, starts have doubled while the Composite Price is barely 8% higher at $320. As one American dealer recently noted during our conversation re. lumber prices, “What is this, the 1950’s?!” If a new Softwood Lumber Agreement is negotiated before October, is it any wonder it will be a more restrictive deal than the last one and it won’t be good news for Canada?

Christmas 2015-001

Dec 25, 2015

Probably some of the most prominent changes I’ve experienced involve the fact that suddenly not only do I have the daily pleasure of fulfilling lumber requirements of valued customers, but also, I’m into negotiating the daily whims of an active six year-old daughter – with a four-year-old encore commanding equal time most days. On some days no doubt the opportunities awaiting attention at the office seem like welcome respite.. until I’m back home at night, where a small daughter’s smile wins me over.. and over.. reaffirming reality that fives years has gone by in a flash!


Where’s the Wood?

Construction cranes dot the Lower Mainland landscape where stacks of safety deposit boxes for persons unknown er condo developments abound. Today we get a close look at West Fraser wood being hoisted into place at a condo development next to the Dakeryn office in North Vancouver, confirming reports that not all local production is being shipped to export markets these days..

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