The value of domestic forestry is still far below prerecessionary levels, dampening industry demand
New York, NY (PRWEB) August 30, 2014
The Construction and Forestry Equipment Wholesaling industry has performed well over the past five years. With the notable exception of Liebherr, almost all major manufacturers of construction and forestry equipment and machinery carry out their Canadian distribution operations through independent wholesalers. As a result, the very large domestic construction and forestry sectors (together valued at about $250.0 billion) source almost all of the heavy machinery and equipment that they use from operators in the Construction and Forestry Equipment Wholesaling industry.
The Construction and Forestry Equipment Wholesaling industry's two major downstream markets, the construction and forestry sectors, have performed quite differently over the past five years. Canada was not affected by the US housing bubble that has, until recently, crippled the US construction sector. According to IBISWorld Industry Analyst Zachary Harris, “while the domestic construction sector struggled in 2009, it has grown strongly ever since, driving growth in the construction sector's demand for industry products.” In stark contrast, the domestic forestry sector has languished over the past five years. With the US construction sector as its largest market, the value of Canadian forestry tumbled in 2009 and continued to struggle in subsequent years. While the recent growth in US construction has boosted the forestry sector's sales over the past two years, the value of domestic forestry is still far below prerecessionary levels, dampening this sector's demand for machinery and equipment. In sum, these diverging trends are expected to drive the Construction and Forestry Equipment Wholesaling industry to grow over the five years to 2014.
The Construction and Forestry Equipment Wholesaling industry is expected to grow at a somewhat slower rate over the next five years. “The value of domestic construction is expected to continue to grow, increasing demand for industry products,” says Harris. However, fears of a housing market collapse and a potential tightening of mortgage regulations are expected to dampen demand from this sector. In contrast, the expected strong recovery of the US construction sector is forecast to boost demand for the domestic forestry sector, which in turn is anticipated to purchase more equipment from wholesalers. As a result, industry revenue is expected to grow over the five years to 2019.
For more information, visit IBISWorld’s Construction & Forestry Equipment Wholesaling in Canada industry report page.
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IBISWorld industry Report Key Topics
The Construction & Forestry Equipment Wholesaling industry wholesales specialized machinery, equipment and related parts used in construction and logging activity. This industry does not engage in the wholesaling of mining, oil well machinery or equipment, which is categorized under Canada NAICS code 41722.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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