Market Recap: RISI Crow's Construction Materials Cost Index

A price index of lumber and panels used in actual construction for Jan. 7, 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: Early gains in the futures market and a subsequent influx of moderate buying provided incentive for SPF lumber producers to increase quotes. Eastern producers were able to play off of the limited availability at western mills. Enough demand, combined with less quick shipping availability, prompted Southern Pine lumber producers to increase prices -- by $15 to $25 for narrow widths. Producers in the Coastal species lumber market experienced "steady sales" throughout the week, helping to establish higher selling levels in both Hem Fir and dry Doug Fir dimensions. Lack of significant volumes of inland Hem-Fir has contributed to the overall sense of supply shortage. Fir-Larch is still undergoing some downward adjustments, with 2x8 and narrower down $5 to $15. Ponderosa Pine Mldg&Btr remains at $1,225 for 5/4 and $1,240 to $1,245 for 6/4. Availability of #2 Shop is tight and still moving up, adding another $10 this week. A little more question surrounds #3 Shop. All #2 Common items are moving well to a "steady" DIY demand. Export demands have kept both Inland and California producers cleaned up on both #3 and #4 Common. Idaho White Pine producers have been forced to some deeper discounts in their competition with Eastern White Pine. The weakness of Eastern White Pine Premium boards "has definitely stabilized," although some confusion remains with regard to both availability and price. Both Standard and Industrial boards are stable. Radiata Pine prices are quite stable and very firm at current levels. Western Red Cedar production continued to ramp up in light of the orders taken for the first quarter.

PANELS: Western Fir plywood prices were firm to $5 higher in most instances, a result of moderate demand enabling producers to edge order files more solidly into the week of Jan. 17. Southern Pine plywood buyers shored up low yard inventory levels and participated in even greater numbers, in response to rated sheathing prices accelerating to levels $20 to $30 higher. OSB mills have positioned themselves above the reported market, pulling activity along in their efforts to see price gains. This has proven successful in most regions. Canadian plywood sales have been most active in the West, according to reports, but the overall tone of the market has been solid in both the East and West. A surprising number of particleboard producers reported that December was a good selling month, contrary to historical patterns. MDF action has been lighter than particleboard, according to some sources.

Source: RISI's Crow's Weekly Market Report

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