Market Recap: RISI Crow's Construction Materials Cost Index

A price index of lumber and panels used in actual construction for Oct. 27, 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

SPF lumber sales continued at a pace supporting higher prices for the ninth consecutive week. Limited supplies of SPF received much of the credit for escalating prices while demand remained strong. Apprehension among buyers to purchase grows each week, but needs often outweigh caution, evident in buyers now purchasing volumes for shipment as far out as the week of Dec. 4.      

  • Southern Pine pricing remained on a downward trajectory. Producers entered the market with greater buildups than the week prior and discounted accordingly. Buyers often reported purchasing the same volumes selling from their yards, avoiding any inventory buildups while awaiting a price bottom.
  • The Coastal species market continued at a decent pace, maintaining pricing across several items, but some started to teeter a bit by week’s end. Buyers began to see greater volumes on some mill lists.
  • Inland species continue to move forward, and buyers are not against getting in line for what they need. The protracted summer has become fall, and mills have good order files.
  • Stud items once again varied in degrees of strength, lending to narrowly mixed price changes. Much of the market’s weakness was found in 2x4 items, where prices tended to decline $5 in most instances. On the other end of the spectrum, supplies of 2x6 9’ trims remained relatively tight.
  • Buyers say they are finding more Radiata Pine available, but through August, imports of the species into the states is down from last year.
  • Demand for Ponderosa Pine 4/4 Selects is sufficient to keep prices very firm. This year has seen one modest increase in Selects, some months ago. All 4/4 Common boards continue to be in reasonable demand, but they have clearly slowed from the strong markets earlier in the summer.
  • Western Red Cedar producers reported sluggish trading. Buyers filled in inventories with a broad array of items purchased in modest quantities.  

Panels

Buyers retreated from the OSB market this week as pricing continued to unravel in all but two regions. Retail takeaway still has some strength with the fall building season; however, caution and low inventory maintenance are the rule.       

  • Southern Pine plywood sales slowed, placing more downward pressure on rated sheathing prices. Seeing a weakening market, buyers limited their participation in anticipation of lower prices. Several buyers continued to wait on late shipments from producers trying to catch up with orders.
  • Greater numbers of buyers held out of the Western Fir plywood market after seeing increased urgency among producers to sell. Mills lowered CDX quotes early, but by the end of the week admitted $10 discounts did not draw much more consideration from buyers.
  • Canadian plywood pricing approached a perceived bottom, which quelled anxieties and brought buyers back to the table. Mills offered discounts early in the week to move files, but firmed by week’s end.
  • Producers of both MDF and particleboard often reported a steady to moderately slower sales pace. Yards maintained close checks on inventory levels ahead of November and an approaching Thanksgiving holiday that typically ushers in an even slower rate of sales.

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