Market Recap: RISI Crow's Construction Materials Cost Index


A price index of lumber and panels used in actual construction for June 10, 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: Buyers of SPF lumber stayed on the sidelines in large numbers, digesting previous purchases. Most dimension lumber pricing remained static or adjusted only slightly in both the East and West. The depth of Southern Pine lumber mill discounts often varied widely, dependent on the individual mill's need to sell particular items. Meanwhile, buyers chose precise tallies to fill inventory holes. The Coastal species lumber market has achieved what other markets continue to struggle with -- a balance between supply and demand. Dry Douglas Fir was especially strong, while Hem-Fir increases were more moderate. Limited supplies of green Doug Fir kept prices from drifting lower, despite pedestrian demand. The narrows in Fir-Larch have seen increases of $5, with the wides less active. Inland Hem-Fir is doing well simply to hold onto its prices. Both 5/4 and 6/4 Ponderosa Pine Mldg&Btr appear to be priced acceptably, with no change for the time being. The 5/4 #2&Btr Shop is available readily enough to warrant no change. The 6/4, on the other hand, is tight and moves up $10. Most of the board market is moving along with little change from recent weeks, but a few items are clearly worth noting. Eastern White Pine producers are beginning to sense a little more energy in the market and some uptick in demand from key retail chains. The situation in New Zealand has become virtually unbearable for Radiata Pine producers, based on the value of the New Zealand dollar. Spotty and slight increases in demand were reported by producers in the Western Red Cedar market. Overall, buying remained limited and any uptick in demand was not across the entire market.

PANELS: Buyers needing to fill inventory holes provided enough demand in the Western Fir plywood market for prices to bounce off of floors. Although Southern Pine plywood producers reported selling production or more, prices were unable to gather any upward momentum. Instead, any price movement remained downward. No continent-wide OSB market exists, but some spot regional activity gives evidence that a little energy is flowing into the system. At least one key Canadian plywood producer promoted some buyer response by discounting his offerings. The presence of the discounted wood in the system does affect trading, so the new baseline price is C$290 for 9.5 mm CSP delivered to Toronto. During this session and carrying over from last, particleboard and MDF producers in both the South and the West have increased their prices, with the results yet to be defined.

Source: RISI's Crow's Weekly Market Report

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