Market Recap: RISI Crow's Construction Materials Cost Index

A price index of lumber and panels used in actual construction for Aug. 27, 2010

*Western - regional species perimeter foundation; Southern - regional species slab construction.

Crow's Market Recap -- A condensed recap of the market conditions for the major North American softwood lumber and panel products as reported in Crow’s Weekly Market Report.

LUMBER : Sales to Asian markets over the past few weeks continued to bolster western SPF prices. Mills raised quotes modestly and held prices on the back of order files into the weeks of 9/6 and 9/13. Sales activity remained sluggish in the Southern Pine lumber market. Market players agreed that downside risk was minimal, but producers admittedly struggled to achieve higher price levels. Green Doug Fir producers increased their prices for narrow widths early and maintained those levels. In dry items, prices were fairly steady and sold within a narrow price range. Although overall prices of Inland species drifted off this week, Hem-Fir has generally avoided the declines taken by Fir-Larch, based on thin production volumes. Ponderosa Pine Mldg&Btr is still holding its levels, in the face of absolutely dormant demand. Shop continues to show some declines. Some decent action continues in both #3 and #4 Common and their equivalents, and the DIY demand for #2 is picking up. Radiata Pine Mldg&Btr and Shop has no more market strength than Ponderosa Pine. Idaho White Pine continues to be offered in the same ranges as last week, with no changes on any items. Eastern White Pine buyers are looking for quick delivery and service, not price concessions at this point. Sales in the Western Red Cedar market continued at a sluggish, yet steady pace. Buyers voiced little concern over availability of product, in large part due to modest outtake from their own yards.

PANELS: Producers of Western Fir plywood reported selling decent volumes, especially if they had what buyers needed for quick shipment. Southern Pine plywood producers were not bashful about setting the week's tone early with double-digit price increases. Wholesalers both back-to-backed orders and purchased conservative speculative volumes. For the last two weeks, the OSB markets of the continent have teetered on the brink, holding near established levels without significant price drops. A few locations, such as the North Central region and the South, even gained a couple of dollars. Canadian plywood producers now have order files into the week of Sept. 6 or 13, which has been more than enough to encourage them to raise their baseline price, but buyers are taking little wood at the new level. In both the Inland and Coastal regions, particleboard prices continued to move downward. Prices of MDF are stable, with specialty products having what little strength can be found in the marketplace.

Source: RISI's Crow's Weekly Market Report

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