Logging Equipment 2018: Who Are the Players?

Industry analysts have released recent logging equipment numbers—let’s take a look.  We are only a few months into 2018, but industry analyst firm EDA has begun to divulge the financing numbers for forestry and logging equipment. They've detailed the most popular equipment types, the top buyers, and the top logging equipment finance companies. Judging by the data, sales of new logging equipment is off to a strong start despite industry concerns over lumber supply.

Here are the numbers for the top lenders and buyers from February:

The Buyers

·         BLUE STAR EQT LLC              DETROIT, MI                              10
·         LOGGING EQUIPMENT           BANDIT                                        5
·         LOGGING EQUIPMENT           MORBARK                                   5
·         TREESMITHS INC                    SPRING BROOK TWP, PA           5
·         LOGGING EQUIPMENT           ALTEC                                          5

The Lenders

·        JOHN DEERE INDL CREDIT                                  78
·         CATERPILLAR FIN SVC CORP                             46
·         DE LAGE LANDEN FIN SVC                                  25
·         WELLS FARGO VENDOR FIN SVC LLC               18
·         STEARNS BANK                                                    15

John Deere continues to reign supreme among other lenders in the category with a total of 78 equipment financing deals in the month alone. On the buyer side of the equation, Blue Star purchased double what other buyers in the category bought.

Most Popular Equipment Types

EQUIPMENT TYPE                           BUYERS           UNITS

·        LOG LOADER                             41,547             89,621
·         SKIDDER                                   46,872             89,598
·         GRAPPLE SKIDDER                 24,636             60,225
·         CHIPPER                                   36,962             58,767
·         FELLER BUNCHER                  18,252             43,563
·         CRAWL#R DOZER (LO            20,806             38,263
·         STUMP CUTTER                      23,829             33,041
·         SAWMILL                                  19,883             25,644
·         WHEEL LDR (LOG)                  11,647             23,443
·         EXCAVATOR (LOG)                  10,087             23,435

Industry analysts note that felling equipment continues to be the most popular type of logging equipment in the world’s market, while aftermarket parts and specialized attachments, along with extracting equipment follow.

EDA’s industry data finds that log loaders and skidder were virtually tied for units sold in the period they measured. Following these two equipment types was the grapple skidder and chipper.

Reasons for Demand

Freedonia Group predicts that the United States will account for as much as 19% of all global product demand through 2021. What is the reason for this growth? Many industry analysts point to the rise of construction activity in the U.S., roundwood production, and the use of logging methods that require higher-end equipment.

Growth in Other Countries

The Asia/Pacific region is expected to see gains over the next few years along with the United States. Latin America will also see some growth in their lumber equipment purchases, with industry experts noting they could experience 6.5% annual growth on through 2019. In addition, Finland, Poland, New Zealand, and Indonesia are all expected to see above-average gains.

After experiencing impressive gains from 2011 to 2016, Canada is now bracing for a deceleration in market gains. The increased import duties on Canadian exporters doesn't help their growth, and increased prices force them to store more lumber on their side of the border.

Wrapping it Up

What do you expect to happen in the U.S. lumber equipment market this year? If these trends continue, it could be a great year for financiers and buyers alike, however concerns over a supply gap still remain in the forefront. Either way, many are bracing for increased lumber prices by making use of the best equipment they can.