Market Recap: RISI Crow's Construction Materials Cost Index

A price index of lumber and panels used in actual construction for June 27, 2014

*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 press prices higher. Buyers filled needs prior to the upcoming Canada Day and Independence Day holidays. Order files as far out as the week of July 21 and scheduled shutdowns at eastern mills in July also prompted buyers to replenish inventories. Southern Pine dimension lumber prices continued to decline. Buyers wanting some retrenchment in prices refused to participate. Treaters trying to “skinny down” inventories have also contributed to a more modest pace. Coastal producers were able to maintain price levels for dry species in most instances. Green Doug Fir prices for #2&Btr items continued to increase. Buyer participation in the green market remained strong. Inland pricing of both Fir-Larch and Hem-Fir lumber made progress, with mills reporting that they have sold out of certain items. The market is not hot, but it is active enough to energize most participants and bring in buyers in significant numbers. Chilean producers of Radiata Pine report that inquiries for Mldg&Btr lumber have quieted. The low prices being generated by solid lineal mouldings plays into this, as does the softening of New Zealand log sales to China. Ponderosa Pine industrial lumber prices are reported to be stable. In boards, prices of Ponderosa Pine narrows still show some softness, with losses being limited to $5 to $10, where they occur. Eastern White Pine producers continue to report a tightly balanced market, with supply and demand in sync. Most mills have been able to adapt closely to the needs of their core customers, resulting in some selective proprietary arrangements. Strong volumes of Western Red Cedar continued to sell at the mill level. Producers hustled to ship orders prior to month-end and worked at selling minor accumulations of a few items.

Panels: OSB pricing stayed generally sideways over the week, with no downside noted. Activity was muted. Mills do not seem willing to take counters at this point. The sales pace in the Southern Pine plywood market picked up momentum as the week progressed, placing upward pressure on some prices. Distribution yards replenished inventories, and wholesalers came back in to purchase conservative volumes after selling off their positions established a few weeks earlier. Buyers again stepped in to purchase, prompting traders to describe the overall Western Fir plywood market as “steady.” As a result of demand and less plywood availability over the next month, CDX sold at prices $5 to $10 above previous levels. Canadian plywood markets firmed, and distributors and mills were in almost uniform agreement that a two-point pricing uptick was in order. The particleboard market remained moderately stronger in the South and East than in the West. Sales activity at western mills was lackluster. Several mills booked less than a week’s worth of production but stated it was expected. Even with the recent shutdown of an MDF mill, western MDF buyers did not find it difficult to locate supplies.

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