Market Recap: RISI Crow's Construction Materials Cost Index

A price index of lumber and panels used in actual construction for Oct. 6, 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

Price trends in SPF lumber continued. Producers sold limited offerings at persistently higher price levels, keeping order files extended, sometimes as far out as early November. Buyers held out when possible, preferring to digest prior purchases and wait out mill order files.      

  • Most #2 Southern Pine prices continued to gain, but more modest sales activity placed less upward pressure on prices than in prior weeks. Yards continued to report good sales but approached the market more cautiously.
  • Coastal species lumber prices continued down the same path, as largely flat green Doug Fir prices lagged the gains taking place in dry. Customers continued to replenish with conservative volumes that could ship relatively quickly.
  • Although some Inland producers reported decent sales some commented that their sales volume was a little lighter this week. In no case, however, were any signs of weakness noted.
  • Price volatility in studs was minimal. Some prices edged moderately higher while a few producers showed a willingness to discount. In general, 2x4 availability was more plentiful than 2x6. Supplies of 2x6 9’ remained relatively tight.
  • Whether it is Radiata Pine or Ponderosa, the supply side seems to be in reasonably good shape. Radiata Pine from New Zealand continues to flow into the US in heavier volumes than for some time.
  • Ponderosa Pine 4/4 boards are “moving steadily,” according to the producer consensus. Among the Common grades, only 1x6 #3 was noted for weakness. In Ponderosa #2 Common, the only change was in 1x12.
  • Western Red Cedar producers reported steady sales activity as the fourth quarter commenced. Buyers continued to purchase near-term needs in volumes they could sell before the conclusion of their building season. Others purchased to cover fourth quarter needs. More buyers are now looking further ahead, forecasting requirements for the first quarter.

Panels

OSB markets presented a scattered picture with regard to prices. Most regions maintain active retail business, as builders try and make the best of the waning season. Buying continues hand-to-mouth, and no one wants a long position. The repeating theme perpetuates price strength.    

  • Sales activity in the Southern Pine plywood market remained steady, leading to higher prices. Producers reported order files into the week of Oct. 23, with one producer garnering orders as far out as Nov. 20. Buyers often purchased truckload volumes to cover near-term needs in light of high prices.
  • Sales activity in the Western Fir plywood market was often described as “slower” or “steady.” Mills, however, did bump quotes a few dollars and sell at moderately higher levels. Buyers purchased panels that will ship the weeks of Oct. 23 to 30. Buyers chased orders, needing deliveries.
  • The Canadian plywood market tried unsuccessfully to find a solid trading level. Pricing continued its downhill glissade from record highs, while mills reached out and listened for offers.
  • Particleboard sales volumes were little changed from the prior week, leaving producers’ order files stable or slightly eroded.
  • MDF sales were often considered a notch better in both the West and East than particleboard, despite ample MDF imports available. Thermally fuse laminate sales were steady.

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