Price risk is always a factor in the commodity lumber market, and an effective tool to manage this risk is the Sitka Forest Products Fixed Forward Pricing program.
A prime example of price risk is having orders that obligate you to deliver products at a fixed price, but at some time in the future. Usually buying up front and storing the product is not practical from both a cost and logistical standpoint. Forward pricing by Sitka Forest Products gives you the ability to fix lumber and panel costs over the life of a job, thereby locking in profit on that project, without having to store it or pay for it until it ships.
In addition, fixed forward pricing allows you or your select customers to comfortably and confidently bid on projects that will be delivered over an extended period of time. This gives you a competitive advantage in the marketplace to obtain new business with locked in profits, instead of guessing what your costs will be.
How it works
The mechanics of forward pricing begins with Sitka Forest Products and your company setting a fixed price for each product, its applicable volume, and specified times of shipments, up to 12 months out. Invoices are produced at the time of shipment and payment is due according to normal invoice terms. The advantages are no carrying costs and locked in profits.
If you are interested in getting a fixed forward price quote, or want more information, please fill in the form on the right: