Market Recap: RISI Crow's Construction Materials Cost Index


A price index of lumber and panels used in actual construction for June 17, 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: SPF mills' inability to sell at rates equaling production levels eroded order files, generating some negotiated deals. Wholesalers with positions continued to sell at prices $10 below replacement costs. Southern Pine lumber producers continued to struggle to sell production, leaving them open to negotiated price levels. Treaters purchased multiple carload volumes from several producers, but it was not enough to firm prices. Demand remained at a high enough level to push Coastal species lumber prices $5 to $10 higher. Dry Douglas Fir remained a big draw. Green Doug Fir prices were firm to higher. A combination of quiet markets is giving Inland species lumber some pause. This is affecting Hem-Fir considerably more than Fir-Larch, on the basis that Fir-Larch is thinly produced right now. Ponderosa Pine Mldg&Btr is unchanged in price, in either 5/4 or 6/4, and #2&Btr Shop is very firm and holding its price levels. Both #3 Shop and P99 are strong, with price increases. Commons show an odd inversion between #2 and #3 Common. In #2 Common, wides are easier to sell than narrows, while in the #3 Common, narrows are moving easier than wides. Idaho White Pine is generally not available in any volume until the middle of July. Improved weather has given the Eastern White Pine market a little boost, but mills are holding strictly to their projected production volumes. Western Red Cedar buyers purchased volumes corresponding with takeaways. As has been the case for several weeks, there was very little price movement. Mills focused production on the broad demands of customers, negotiating price when buildups occurred.

PANELS: Although not as strong as the week prior, sales activity in the Western Fir plywood market did tick up a notch at midweek. Sales activity increased in the Southern Pine plywood market, firming prices. Distributors and retailers were active, while wholesalers tended to cover shorts and fill their customers' immediate needs. Most of the OSB industry continues to report that "flat" is the term for the marketplace. Even so, a few attempts at raising prices have been made, all by producers, with varying degrees of success. Canadian plywood continues to be basically weak, without strong mill order files or underlying support from the marketplace. Selling levels have been based on the current C$290 mark, but a few sales above and below that number have been made. One key particleboard and MDF distributor commented that the composite market is seeing "no increases in price or demand," which captures much of the situation. 

Source: RISI's Crow's Weekly Market Report

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