Engineered Hardwood – Watch What Happens To Prices
Due to the recent government regulations (translation: incompetent beaurocrats fueled by self interested giant US based conglomerates-yes Warren Buffet, your company is involved) the anti-dumping and counterveiling duty for engineered hardwood flooring looks like it will make a large leap upward. Although the results are not yet final the speculation is a range of 50% duty to 237% duty added to the cost of imported engineered hardwood flooring that is made in china and imported in the USA.
The immediate impact is a large disruption of this particular flooring category’s supply chain – which represents about 40-50% of the engineered hardwood sold in America today. This will force prices higher during a shortage of supply assuming demand holds level. (of course customers may also decide to buy other products besides engineered woods as the supply shrinks and re-sellers are interested in maintaining revenue.)
The funny part: products imported from other countries like Vietnam, Brazil, Ukraine, Portugal, Malaysia and any country besides China are not subject to these new fees.
Therefore the net effect will only be disruption and probably a net cost increase overall, but not 50%-200%.
If you are planning on buying engineered hardwood anytime in the next 12 months now is the time to act before all of these disruptions get priced into the market. After about 12 months it will all settle down and should be a more realistic price level.