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22 PalletCentral • May-June 2022 palletcentral.com 2022 Report By Crystal Gauvin Transportation bottlenecks show signs of improving. Lumber Markets I t has been a wild ride for wood products, particularly lumber, over the past two years. From a recession in the second quarter of 2020 to record high prices just one year later, participants in these markets are left with many questions, especially where prices are headed. To answer these, one would normally start by looking at the drivers for lumber demand, but this time it's more important to examine the supply- side constraints that have held back housing over the past half decade. e transportation shortage in North America has delayed construction projects, added fuel to the lumber rally, and forced some Canadian mills to curtail production as their yards fill up with inventory. Supply-chain snags have been a feature throughout the pandemic, as home-bound consumers spend money on goods rather than services, while a labor shortage exacerbated the transportation sector's ability to keep up with demand. On numerous occasions, wildfires, flooding, and heavy rains brought rail and road movement to a halt. Now, even as demand for rail transportation is expected to hold strong throughout 2022, North America's lumber sector is looking toward what appears to be a "light at the end of the tunnel" as railcar availability has improved in recent weeks, according to sources. In the U.S., 3,452 cars carried lumber and wood products in the week ending April 9, 2022. ough this is down 1% from the same week last year, it follows strong week of 3,536 cars. Year-to-date, U.S. railcar movement in the sector is up 1.5%, the Association of American Railroads (AAR) data show. In Western Canada, where infrastructure was damaged by wildfires and unprecedented flooding last year, transportation remains sluggish. Canada-wide, 2,974 railcars transported lumber and wood products in the week ending April 9, down 11% from the same period last year and following a more successful week of 2,991 cars. Year-to-date, these shipments are down nearly 10% versus this time in 2021, AAR figures show. General car velocity data from CN Rail also show improvements, though slightly below 2020 and 2021 levels. In week 15 of this year, CN cars were moving roughly 200 miles/day compared with around 150‒175 miles/day in previous weeks. Statistics Canada data show just how weak the country's softwood lumber shipments have been. ey dropped for the fourth straight month in January (the most recent available data) to 3.8 million m3. at is 16% below January 2021 and the lowest level in at least three years. While rail movement of lumber is showing signs of quickening pace, it is still constrained in Western Canada and nearby U.S. regions such as the Pacific Northwest and Idaho, according to sources. In some areas, rail remains the most attractive mode of transportation as soaring fuel prices raise trucking costs; however, there are indications that fleets are growing to meet strong demand. Earlier this month, Walmart announced it will raise starting salaries iStockphoto.com/Elenathewise

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