Market Recap: RISI Crow's Construction Materials Cost Index

A price index of lumber and panels used in actual construction for Sept. 15, 2017.

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

Demand remained strong amid tighter SPF supplies. That combination propelled several #2&Btr prices in both the East and West to levels not seen since September 2004. Happy with prices, mills looked to extend order files. After exhausting inventories in July, buyers continued to replenish.   

  • Southern Pine producers raised dimension prices more aggressively than in prior weeks, bumping most #1 and #2 grades $10-25. Buyers often experienced tighter availability at mills. Electricity outages in the wake of Hurricane Irma shut down mill production and closed sales offices in Florida and Georgia.
  • Limited availability and good demand continued to place upward pressure on Coastal species prices. Limited supplies available at mills, due to demand and limited log availability, made the market difficult for buyers to locate and cover particular needs.
  • Inland prices for both Fir-Larch and Hem-Fir made some good gains in Select Structural, MSR, and #2&Btr.
  • Most stud prices meandered higher as buyers continued to cover needs at a good pace. Solid takeaways from yards and continued replenishment after running inventories low kept buyers busy. Limited availability in some species also contributed to price momentum.
  • Radiata Pine shows no general changes, but it is readily available for those who have needs.
  • Ponderosa Pine industrials show very little change, holding their levels in both Mldg&Btr and most Shop items. The exception would be in 5/4, where #3 Shop and P99 show more than ample mill availability. Ponderosa Pine 4/4 Selects showed no changes in price, and all #2&Btr Common boards were stable. Meanwhile #3 or #4 Commons showed specific weaknesses.
  • Idaho White Pine board prices in both Sterling and Standard showed erosion.
  • The sales pace in Western Red Cedar remained lackluster. Expecting decent sales activity to last well into October, at the very least, yards continued to replenish with conservative volumes. High prices remained a sticking point for buyers looking ahead.

Panels

OSB producers are widely off the market, and there is little wood to be found. Pricing had begun to show cracks before the hurricanes hit, but now after Harvey and Irma, numbers are making double-digit jumps. Order files are now mostly into October, with some as far out as November.  

  • Southern Pine plywood pricing continued to escalate in the wake of hurricanes. Buyers looked for coverage in a market in which supplies remained severely restricted. The market was somewhat muddled with respect to quotes and price levels. Mills going OTM at various intervals or the entire week added to market’s lack of order.
  • Western Fir plywood producers raised prices early or edged them higher throughout the week and sold respectable volumes at new levels. Traders suggested that market activity was not as strong as in prior weeks.
  • As buyers of Canadian plywood continue hand-to-mouth behavior due to record-high pricing, some cracks formed in the numbers this week with discounts being offered by mills to stimulate activity.
  • Particleboard and MDF producers experienced few changes in their respective markets. “Steady,” remained the most popular description among producers of both composite panel types.

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