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If you look at any specific shortage, you'll find different underlying reasons. You'll find different dependencies and vulnerabilities. Here we're talking abou
by jmyeet 4y ago
If you look at any specific shortage, you'll find different underlying reasons. You'll find different dependencies and vulnerabilities.
Here we're talking about lumber and the supply chain is fairly straihtforward.
Trees are felled somewhere. They could be planted for that purpose (fun fact: almost all paper comes from trees grown for that purpose, which complicates the story of recycling) or they could be in the wild. These places are typically remote.
Trucks then take these trees to sawmills to be processed. That could be nearby or it could be far.
The products from those sawmills then typically go to lumber yards. The sawmill itself might operate a lumber yard. Or you might have intermediate distributors. In the US a lot of lumber goes through Atlanta for various reasons.
It then gets shipped again to retailers (eg Home Depot) and to builders, pretty much all by truck.
So this supply chain is relatively simple. YOu need labour at several points (eg lumberjacks, sawmill operators, truck drivers), trucks to drive material around, gas for the trucks and land to store products.
So if a handful of players own the sawmills and/or lumberyards when demand upticks you can create a supply issue simply by withholding supply at one of these steps. Maybe you don't open a sawmill or two. Maybe you don't employ people to move lumber from the sawmill to lumberyards. You just stockpile it while the price goes up.
If you look into lumber specifically it's fairly clear that "hoarding" is what was happening. Other shortages may or may not be similar.
- SilasX 4y ago>Trees are felled somewhere. They could be planted for that purpose (fun fact: almost all paper comes from trees grown for that purpose, which complicates the story of recycling) or they could be in the wild. These places are typically remote. Tangent: That just blows my mind how that can be a thing. The trees take like, 20 years to be harvestable? And lumber at the source isn't that expensive? So, how can it be profitable to buy land and guard/maintain the trees for 20 years before you get any profit?
- frosted-flakes 4y agoIn the case of Canada, most timber lots are owned by the government (Crown land), and the right to harvest* it is awarded by auction (I think). Harvesters must also plant new trees. How is it profitable? There is a lot of land. You can drive for many hours down well-maintained logging roads through the BC interior and never see a building anywhere, or even come across any other cars. * This is a point of contention for the US government because they feel that the Canadian lumber industry is government-subsidized and unfairly competes with US lumber producers. As a result, the US applies import taxes on Canadian lumber.
- throw0101a 4y ago> This is a point of contention for the US government because they feel that the Canadian lumber industry is government-subsidized and unfairly competes with US lumber producers. As a result, the US applies import taxes on Canadian lumber. This has been going on for decades: * https://en.wikipedia.org/wiki/Canada–United_States_softwood_lumber_dispute https://en.wikipedia.org/wiki/Canada–United_States_softwood_...
- genocidicbunny 4y agoYou should check out exactly how much land is owned/used by some of the companies. Check out for example a satellite view of southern Oregon. You'll see a checkerboard pattern in the forests all over the place. Those are big patches of managed forest that are in various stages of growth. It's like a pipeline -- yes it might take 20 years to grow a patch to harvest quality, but you have 100 of these patches and only harvest 5 a year. By the time you get around to needing to reharvest patch #1 it'll have been 20 years and it will have regrown.