Market Recap: RISI Crow's Construction Materials Cost Index

A price index of lumber and panels used in actual construction for Nov. 15, 2013

*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: SPF lumber producers continued to hold the upper hand despite slower trading activity. With orders out in front of production by at least a couple of weeks, mills quoted firm prices after a late run the week prior pushed prices higher. Limited Southern Pine lumber availability continued to place upward pressure on dimension prices. However, sales activity was not as crisp. Steady sales on a weekly basis remained one of the catalysts driving some lead times for wide widths into early December Coastal species lumber prices higher. Buyers cautiously purchased needs with some delivery dates approaching the end of the year. Light inventories of Inland species lumber in the field forced buyers to return to the mills sooner than they would like. Wholesalers continued to see strong sales out of reloads. Producers reported that demand for Radiata Pine Mldg&Btr is still greater than what they can offer. The market for Ponderosa Pine Shop grades seemed to be in parity. Producers maintained good order files and held prices firm but also indicated there was less of a sense of urgency from buyers. Ponderosa Pine board producers reported steady inquiry for narrow #2&Btr, with 1x6 the most sought after. Steady demand, along with limited supply, continued to keep board prices on an upward track. Eastern White Pine mills continued to do a land-office business, as buyers scrambled to find 12-in. Premium and Standard. ESLP sales were steady. Colder weather dropped into the South, but the lack of precipitation kept Western Red Cedar volumes moving downstream from secondaries’ yards. Producers continued to fill remaining order files for this year and sell larger volumes blocks for the first quarter of 2014.

Panels: OSB producers leaned heavily on mill order files to keep prices firm. Depending on sales volumes, some regions were more successful than others. Prices in the North Central region came off $5 to $10, as did prices in the Mid-Atlantic region. Southern Pine plywood producers often extended order files more solidly into the week of December 2, prompting them to raise rated sheathing prices a few dollars. Lackluster sales activity did not generate much concern among producers. Western Fir plywood roducers showed no incentive to lower sheathing prices, carrying order files in the weeks of Nov. 25 and Dec. 2. However, buyers seemed satisfied with volumes they purchased the week prior and chose to stay out of the market in large numbers or purchase from secondaries. Canadian plywood mills quoted published levels or a point over but reported light sales and little inquiry. A bit of last minute buying on Friday brought life into the market. Lackluster sales provided little energy in either MDF or particleboard markets. Producers seemed to accept the slower, seasonal market conditions yet maintain optimism for 2014.

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