Market Recap: RISI Crow's Construction Materials Cost Index


A price index of lumber and panels used in actual construction for April 22, 2011

*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: Light sales drove SPF prices lower. The market carried its fair share of negativity, which was fueled once again by declines in futures and its considerable discount to cash. Southern Pine lumber mills continued to scour the market, looking for customers with immediate needs. Negotiated prices below quoted levels were common. Lack of demand, log prices and subsequent draw-downs in production shaped prices in the Coastal Species lumber market. Declines of $5 to $10 were most common in dry items. The volume of Inland Species lumber mill inventories varies, but all producers seem to have more than they are comfortable with. Discounting is common, and some producers have offered 30-day terms in order to secure business. Ponderosa Pine Shop and Mldg&Btr have both shown solid gains, promoted more from the supply side than from the field. Some wide price spreads exist among producers of #2 Common, while #3 Common has been buoyed by exports, which continue to keep it steady and fairly flat in its prices. Idaho White Pine is still in something of a middle state of production, with one cycle having been sold and another in the beginning stage coming up next week. Eastern White Pine producers continue to focus on their key customers, intent on providing sufficient material for the spring. Radiata Pine Mldg&Btr remains at $1,200 to 1,250, and it is very difficult to find Shop. Struggles in the Western Red Cedar market continued, as limited demand made it difficult for producers to garner the higher prices they seek.

PANELS: Western Fir plywood buyers approached the market conservatively, rarely looking beyond their immediate needs, even as producers strongly suggested that current prices were at investment levels. Sluggish sales and the need for Southern Pine plywood producers to move volumes forced discounts for rated sheathing and underlayment and softened the prices of other items. OSB sales have been light in most regions over the entire course of the week, but a sense of bottoming has taken place in all but the far western part of the market. Canadian plywood has entered a discounting phase. The actual level of discounting is unclear, but much of this week's business, which was not great, was done on discounts. The sense of competition that has marked western particleboard sales for weeks and months increased in recent trading, driving Inland prices down by $10. The Inland region alone showed price adjustments. All other areas held to established numbers.

Source: RISI's Crow's Weekly Market Report

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