U.S. Sawmill Output Stagnates as Capacity Peaks and Utilization Rates Weaken
Rubber and Wood | 2025-12-24 07:00:28
Sawmill capacity, meanwhile, declined 1.2% from the first quarter of 2025 but remains well above earlier years, sitting 4.5% higher than in the second quarter of 2023.
By Paul Ploumis
SEATTLE (Scrap Monster): U.S. sawmill output has shown little momentum over the last two years, reflecting a period of stabilization rather than growth, according to the Federal Reserve’s latest G.17 Industrial Production data. The report incorporated an annual benchmark revision that lifted estimates for both sawmill production and capacity, indicating that current output now stands roughly 7.5% above 2017 levels. Revised figures also show national sawmill capacity reaching a high point in the fourth quarter of 2024.
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Sawmill Production Flat over Last Two Years
Based on a four-quarter moving average, production edged up 0.9% in the second quarter of 2025 compared with the prior quarter. Even so, overall output remains only marginally higher—about 0.3%—than levels recorded in 2023, underscoring a prolonged period of subdued activity.
Sawmill capacity, meanwhile, declined 1.2% from the first quarter of 2025 but remains well above earlier years, sitting 4.5% higher than in the second quarter of 2023. This divergence reflects weaker utilization rates, which have trended downward since 2017 as capacity additions outpaced production growth.
Persistently soft lumber prices over the past two years have encouraged mill curtailments and closures, contributing to early-2025 capacity reductions. At the same time, employment at sawmills continues to fall, largely offset by productivity gains from automation and modernization.
POLL
What is the biggest factor limiting growth in U.S. sawmill output?
Frequently Asked Questions
- What does the Federal Reserve’s revised data show about U.S. sawmill output?
Revised G.17 data indicate current sawmill output is about 7.5% above 2017 levels, but growth has largely stalled over the past two years.
- How did sawmill production perform in mid-2025?
On a four-quarter moving average basis, production rose 0.9% in Q2 2025 quarter-on-quarter, but remained only 0.3% above 2023 levels.
- Why are utilization rates declining?
Utilization has fallen as capacity additions since 2017 have exceeded actual production growth amid weak lumber demand and pricing pressure.
