RISI Crow’s Market Recap for June 1

A price index of lumber and panels used in actual construction for June 1, 2018.

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 price adjustments for most key items were minimal as buyers continued to take a breather. News of the CP rail strike prompted some producers to go off the market until an agreement between the two sides was announced several hours later. A July futures contract discounted significantly to cash prompted buyers to purchase late summer needs from the board.

• Trading in Southern Pine remained active, although the pace eased. Price increases reflected a calmer market and order files in many instances extending into the latter half of June. Digestion, vacations taken after the long holiday weekend and rains from Subtropical Storm Alberto were reasons given for the more pedestrian pace.


• A moderate pace, described by one producer as “more of a grind,” took the wind out of Coastal species price momentum. Despite mills producing more dry Doug Fir when possible, green prices flattened. Yards once dependent on SPF continued to substitute Doug Fir.


• Despite slower calling rates, Inland lumber producers reported that they were “selling good volumes.” Only 2x12 #2 showed weakness, as it has over the last several weeks. Prices were otherwise flat or slightly improved in both Fir-Larch and Hem-Fir.


• Limited volumes of studs available in markets kept moderate upward pressure on many prices. “They’re tight,” noted a trader. Mill order files extended into the latter half of June and, for some items, as far out as early July.


• Ponderosa Pine Commons continued to show lethargy in #2. The #3 and #4 Common were moving reasonably well at unchanged prices. Industrial prices were unchanged in a modest-paced week.


• Western Red Cedar producers often reported steady sales activity. Dry weather in the West kept volumes flowing out of yards in that region. Traders cited high costs of framing lumber for buyers’ hesitancy to speculate on cedar volumes.

Panels

In most regions, OSB activity was serene but markets were firm. The U.S. South slowed with heavy rain. Eastern Canada was the exception, with producers OTM, files into July, and an underbought market panicking.

• Southern Pine plywood producers reported a moderately slower pace, but pricing remained solid to higher. Coming off a holiday and rains in the Southeast were cited as reasons for the drop-off in activity. Strong order files extending as far out as the first week in July contributed to higher rated sheathing quotes.


• After a slow start following the long holiday weekend, Western Fir plywood producers experienced an increase in activity by the middle of the week. Mill order files often moved into the week of June 25, with more minor volumes available the week prior.


• The Canadian government announced a retaliatory 10% tariff on US plywood late in the week, sending Canadian plywood into a frenzy. Pricing rose eight points from last week. Producers and distributors went OTM as prices skyrocketed.


• Both particleboard and MDF producers reported few changes in overall steady market activity. Prices held up, although discounted particleboard in the East was apparent. Meanwhile, attempts to raise both particleboard and MDF prices in reaction to higher resin costs and escalating freight rates were also evident.

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