|
“The basic problem is a shortage of capacity and inability to meet home building demand,” Carliner said. “There were only slight increases in OSB capacity in 2002-2003, and only one new plant is scheduled for 2004. Capacity in North America will increase about 4% by year-end.”
Carliner said that it takes a fairly long time to build an OSB plant and get it up and running at full capacity, so it could be a year before there is any slack in the market.
Weakness in non-residential construction has freed up supplies for many building materials, he noted, but that hasn’t been the case with OSB, because 65% of the supply is used to build homes and another 25% to renovate them.
About a third of the OSB and plywood going into new homes is used for wall sheathing; a quarter is used for floors; and about 45% is for roofs.
Non-structural sheathing can be substituted for walls, with appropriate strengthening of the framing, Carliner said, and many builders have already switched. But there is no easy alternative for floors and roofs.
NAHB has been discussing the problem with OSB producers, and it has been advising its members about this and other emerging problems while at the same discouraging panic buying, which could make the situation worse.
The NAHB Research Center has also prepared information on alternative materials.
In the meantime, rising steel prices are triggering concerns about truss plates and the many other components steel goes into. There are similar, though less severe problems with copper and other metals.
Because steel accounts for a relatively small share of the cost of a new home, except where steel studs or roofing are used, “the biggest concern is probably not the prices,” said Carliner, “but the possibility that supplies will be rationed and builders will have their construction schedules disrupted by delays in receiving materials.”
Don’t Miss NAHB’s Spring Construction Forecast Conference
See what's on the horizon for the housing industry at the semi-annual gathering of the country's premier economists and finance experts. Get the latest forecasts on housing starts, project budgets and other economic bellwethers at the Spring Construction Forecast Conference on April 21 at the National Housing Center in Washington, D.C. Visit the Web site for more information.
| 
