Market Recap: RISI Crow’s Construction Materials Cost Index
A price index of lumber and panels used in actual construction for Dec. 22, 2016.
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 producers were more open to counters in response to limited sales and thinning order files. Most heavily discounted was 2×4, especially at western Canadian mills, as producers were forced to compete with lower priced secondary offerings. Modest Southern Pine sales activity throughout the distribution chain reduced any price gains left in the market to a couple of dollars. Although mostly modest, discounts were more frequent, as availability at mills grew. A combination of moderate sales activity and holiday production curtailments in Coastal species generated prices ranging from flat to firm to edging a bit higher. Wide width green Doug Fir, pricing continued to increase. The Inland market is “just waiting,” according to a number of sources. The pace of trading is slow and quiet, although no negativism shows in the marketplace. A good deal of optimism is the base note at this point. “Decent demand” for a pre-holiday week helped limit any downward pressure on stud prices. Most mills tended to sell close to price levels established the week prior. While some prices edged a few dollars higher, spotty carload volumes were offered at discounts. Neither Radiata Pine nor Ponderosa Pine show any changes in demand or price levels going into 2017. Ponderosa Pine 5/4 #3 Shop is most in demand. In boards, Ponderosa Pine 4/4 Selects remain very stable and unchanged. #2 Common has been quiet, showing stability in the narrows and softness in wides. On the other hand, both #3 and #4 Common have tended to firm up. Western Red Cedar producers reported good order files heading into the new year. More of them are in the process of raising prices or considering increases in January due to potential duties on exports into the US.
Panels: For the time of year, sources agree that OSB activity and pricing are surprisingly strong. Most order files are into the first two weeks of January, though some are out to February. One major producer is off the market. Buyers are watching inventories and purchasing needs. Southern Pine plywood trading was uneventful, often leaving producers with modest order files extending into the first week of January. Quicker shipping volumes also remained available. Producers mostly held quotes across all items throughout the week. Western Fir plywood producers reported decent sales, some days considerably better than others. Those sales propelled order files more solidly into the week of January 2, with some extending further. Pricing adjusted higher in some CDX and underlayment products. Canadian plywood markets are quiet, currently, with holidays, though are widely viewed as firm. Pricing is sideways with some producers trying higher levels, and order files run the weeks of January 9 to 30. Inventories are lean and takeaway was reported steady. Particleboard and MDF producers clung to the perception that business will improve in early 2017. After running inventories low prior to year’s end, some buyers did step in to purchase volumes that will not deliver until after the first of the new year.
Generation Z leads the omni-channel parade
When it comes to combining in-store visits and online product research or purchase, Generation Z (ages 18 to 26) leads all other shopper age groups in the US, lending some spark an otherwise flat “omnishopping” environment.
Just-released findings from GfK’s annual FutureBuy study show that nearly half (46%) of all Gen Z shoppers in the US have researched an item on a mobile device and then bought it in a store – a strategy known as “webrooming.” That level is up 5 percentage points from 2015 and beats other generations by 12 to 27 points.
One-third (32%) of Gen Z US shoppers report they researched a product in a bricks-and-mortar store and then bought it online via a mobile device (“showrooming”). This compares to 24% just a year ago, and bests other generations by 11 to 20 percentage points.
Frequency of showrooming is also higher among the younger generations, with Gens Y (ages 27 to 36) and Z much more likely to say they showroom at least once a week. Generation X (ages 37 to 51), on the other hand, tends to fall into the “once every few weeks to once a month” category.
Overall, webrooming – reported by one-third (34%) of all US shoppers – is much more common than showrooming (21% of US shoppers).
Somewhat surprisingly, Gen Z was also most likely to cite concerns about credit card and personal information security as a reason to avoid shopping online. One-third of all Gen Z shoppers in the US mentioned this worry, up from 26% last year. But the top reason for avoiding online shopping remains the cost of delivery, cited by 50% of all shoppers and 51% of Gen Z.
“These findings really illustrate that generation is a major factor in determining how someone prefers to shop,” said Joe Beier, EVP on GfK’s Shopper and Retail Strategy team. “They also offer a stark reminder of the importance of tightly defining the target audiences for any activation initiatives. The days of ‘one size fits all’ are clearly over.”
GfK’s annual FutureBuy study measures the shifting interactions of digital and in-person activities in the shopper experience, tracking essential trends such as “showrooming” and “webrooming.”