RISI Crow’s Market Recap for June 22

A price index of lumber and panels used in actual construction for June 22, 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

Light trading forced SPF producers to come to market with lower quotes. Sales occurred at various levels, often within a wide range. Another multi-day stretch of futures losses left an ample amount of uncertainty in the market. Western mill sales more focused on Doug Fir reduced the need to sell SPF.

• Southern Pine producers approached the market with greater urgency as prompt shipping volumes grew. Buyers were keenly aware of downside risk involved with purchases and looked to buy at low levels covering any price declines over the next few weeks.


• Prices continued to decline throughout the Coastal species market. Around mid-week, producers moved off significant volumes of green Doug Fir, helping firm those prices. Still, prices across all dimensions in green and dry ended lower than the prior week.


• The Inland lumber market weakened in both Fir-Larch and Hem-Fir, as Canadian lumber production continued to suppress the market. Some Inland producers had backlogs of cars to ship, reducing their need to take excess numbers of orders at discounted levels.


• The same general trend persisted across North American stud markets. Pricing for 8’ items continued to hold or show minor weakness. Meanwhile, higher priced 9’ and 10’ items tended to decline by double digits.


• Neither Ponderosa Pine Mldg&Btr nor Shop ramped up their activity from the demand side, and prices held stable. Major users of Ponderosa industrials can find ample supplies of stock without price changes; users on the fringe are less well supplied. Ponderosa Pine Selects and Commons enjoyed a rarity: a demand-driven week that resulted in some market changes.


• Mill sales activity and descriptions of the Western Red Cedar market varied, most often depending on a producer’s product mix. Those producers sawing for timbers described strong sales and tight supplies. Those producers relying on decking as part of their product mix struggled more to sell production.

Panels

The OSB market went all over the map this week with discounts and special deals, making market prices difficult to pinpoint. Western Canada softened precipitously and buyers were reluctant to jump in, opting to run down inventories until a trading level is found.

• Southern Pine plywood buyers held off purchases whenever possible, seeing producers continue to offer lower prices. Some of the deepest discounts attracted buyers, in part because aggressively priced panels carried prompt ship dates. Some carloads sold at deep discounts to rid producers of excesses.


• Production outpaced demand as the Western Fir plywood market limped through its third week of more modest sales activity. Many western buyers continued to purchase truckload volumes like clockwork. A lack of carload sales to eastern customers limited the ability of mills to maintain order files.


• The Canadian plywood market remained quiet but firm this week, with limited mill level action but busy yards at the distribution level. Sources indicated the digestive period may be nearing an end.


• Particleboard producers reported good sales with order files out to mid-July. Some lead times extended a little further.


• MDF sales remained strong. Moulding manufacturers continued to purchase steady volumes, supplying a growing residential construction market and strong repair and remodeling sector.

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