Industry Report: Sawmills and Wood Production

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Industry: Sawmills and Wood Production

Naics: 321113

Private Company Multiples

Industry Overview

The US sawmill industry has experienced significant fluctuations. In 2019, the industry struggled due to increased regulations. 2020 brought a pandemic-induced housing boom, driving demand for home improvements and single-use paper ware.

Industry revenue grew at a 5.9% CAGR through 2024, reaching $48.9 billion. Canadian imports, supported by the USMCA, compete with domestic producers. US sawmills face stringent regulations on worker safety, fire risks, and construction standards, increasing operational costs.

In 2023, the Fed raised interest rates to combat inflation, cooling the housing market and reducing lumber demand. The industry is projected to grow at a 1.6% CAGR through 2029, reaching $52.8 billion.

The Infrastructure Investment & Jobs Act is expected to boost demand and potentially streamline operations. Modernization efforts, including automated log cranes and loading systems, are being considered. However, the heavily unionized workforce may resist automation.

Cross-laminated timber presents a potential innovation, allowing for taller and safer wooden structures. This could open new markets for the industry.

For industry participants, success will require navigating regulatory environments, embracing innovation, and positioning for future developments. The industry is evolving beyond traditional log cutting, with opportunities in advanced wood processing technologies.

Key Financial Metrics

Income Statement Benchmark

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