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Market Recap: RISI Crow’s Construction Materials Cost Index
A price index of lumber and panels used in actual construction for Nov. 25, 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: Order files established the week prior extending as far out as early December, especially in 2×4, enabled SPF producers to maintain firm pricing in both the East and West. Both producers and wholesalers reported "steady" sales well into Tuesday. A short production week and enough prior Southern Pine lumber sales to push order files largely out through the week following the Thanksgiving holiday prompted producers to elevate dimension prices $5 to $10. Production cutbacks and prior sales put Coastal Species lumber producers in a good position entering the week. As a result, dry prices were stable. Limited supplies of green Doug Fir and moderately improved demand sent those prices higher. Inland lumber producers reported a little action on Monday, but the remainder of the short holiday week was quiet. A quiet week was anticipated, as many traders planned on taking all or part of the week off. Ponderosa Pine board prices were mostly unchanged at Spokane mills, the exceptions being 1×6 #2&Btr and 1×12 #3, which both came off $10. Idaho White Pine board producers reported good activity for Sterling grade. Prices for Standard and Utility were unchanged except for 1×12 Standard, which adjusted down $15 to close the week at $410. In Industrials, Ponderosa Pine producers had order files for Mldg&Btr well into December. Radiata Pine Mldg&Btr offerings from Chile were scarce, with very little availability before the first of the year. Sales activity was understandably "slow" in the Western Red Cedar market. Distributors showed limited interest in purchasing any near-term volumes. Orders for shipment in 2012 were placed.
Panels: OSB producers reported some follow-through from last week’s improved market. The volume of cash sales was light, and prices were firm. Most mill order files were into the week of Dec. 12, but buyers reported availability for next week. Although several Southern Pine plywood producers reported sales activity somewhat sluggish, it was more than they expected. Order files moved more solidly into and through the week of Dec. 12. Rated sheathing quotes were raised, and success was achieved at moderately higher price levels. Western Fir plywood sales activity was "surprisingly good" for some producers and "slow" for others. Order files extending into the front half of December buoyed prices and pushed them higher in a few instances. Canadian plywood prices, for both cash and contracts, were near last week’s published levels. Producers reported order files into the week of Dec. 12 or 19. Few changes in particleboard and MDF markets were evident, leading a few producers and buyers to describe the market as "status quo."
Readers Respond: Down on Main Street
Home Channel News Tuesday asked the following question: Which of the following is the biggest threat to small business today: a) too little credit; b) too much regulation; c) the economic slowdown; or d) all of the above.
The most popular response was “all of the above.” Here are some highlights from reader letters:
"Struggles of small businesses in today’s market are more than just tight credit, regulations and a poor economy. This inevitable crisis was years in the making while we all stood by watching.
“We live in a society in which no one wants to take responsibility for their own actions, and it is expected for someone or the government to step up and bail us out of the mess we have created for ourselves and others. We have become entitled or at least think we are. It’s as if the average American feels it is owed to them and not because they have earned it. Since children we have trained them that everybody is a winner when in ‘real life’ that is not true.
“Lawsuits are rampant, and we settle unjustifiable suits because it makes economic sense, not because we are guilty. Therefore we have created the ‘easy money’ plan for attorneys and plaintiffs.
“We have allowed people who cannot handle their money to file bankruptcy will little or no consequences. Small businesses are caught in the crossfire of this and are the ones who crawl away wounded or dead. Then we allow the offenders to do it all over again.
“Too many times our local governments will court the competition based upon vague promises, all under the pretense of creating jobs. Hardly ever does the government come to the local small business and asked, ‘What can we do to help you grow?’ The only time they appear is when informed of the impending closure, and they can’t understand why this store cannot make it. After all, they created all those new jobs so you should be doing fine. How many city officials from Harrodsburg, Ky., went to Coleman Lumber and asked what they could do to help the 100-year-old company. How many Representatives or Senators looked for grant money for this company or worked on a SBA loan? The government only thinks about small companies when they are gone and the tax revenue is no longer coming. Then they look at the rest of us to shoulder the revenue they lost.”
— Arthur Mize
Associated Lumber Industries
“ ‘Too much regulation’ is such a generic, undefined broad-based sound byte that it has lost all its meaning. Let’s not forget that it’s the lack of regulation that got us into this mess. Exactly what regulation hurts retail? Health care? Minimum wage? Unemployment benefits? These costs affect everyone the same. This is simply the echoing of special interest groups with a much broader political agenda.
“The issue with the economy is unemployment and the lack of disposable income for the lower and middle classes. For years we have had access to home equity that never really existed, and now it’s time to pay the piper.
“Who would hire and invest in business without cash or demand? Regulation has nothing to do with it.”
— Frank Douwes
“All the above, plus some. Anti-business attitudes from Washington aid and abet this threat. Underwater home value and lack of confidence in our leaders and direction of our country. Health care. Taxes. As the old saying goes, ‘It is what it is.’ We will take these challenges head on and somehow succeed. Because that’s what we do.”
— Paul Gabbard