Market Recap: RISI Crow's Construction Materials Cost Index

A price index of lumber and panels used in actual construction for Oct. 30, 2015

*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: Fluidity in the SPF lumber remained good throughout the supply chain. Producers reported solid sales, although often not enough to seek higher prices. Instead, they continued to bolster order files, with some lead times in narrow widths extending lightly into the week of November 23. A notably slower sales pace at Southern Pine lumber mills brought about what increasingly appeared to be a turning point in the market. Most often, mills fell back on order files to maintain many price levels. Sales activity in Coastal species continued at a solid pace, lifting many #2&Btr prices. Dry Doug Fir pricing remained the strongest. Wholesalers attempted to sell off positions and secure trucking for orders prior to attending the NAWLA gathering next week. Inland lumber producers report steady demand this week, with good price appreciation in certain key items. Overall activity at mill level has been less hectic than in the previous couple of weeks, but the market is still trending in an upward direction. Studs continued to sell at steady to higher price levels. Most of those increases were of the $5 variety. Some reports indicate that regular users of Radiata Pine have begun reconsidering their use of the product, given its wide price spread with Ponderosa. Ponderosa Pine Mldg&Btr continues to be reported at unchanged levels for both 5/4 and 6/4 stock. Recent reports indicate that Ponderosa Pine in both Selects and #2 Common boards are in good demand and moving at a reasonable pace from both mills and warehouses. Sales in the Western Red Cedar market remained seasonally slow overall. Producers noted that calls from Texas were considerably less, largely due to extreme weather and flooding the state experienced early in the week.

Panels: OSB pricing gained more strength from last week, up appreciably in most categories, leaping $20 in many cases. However, activity was a bit quieter this week, as winter weather approaches and buyers begin to consider the possibility of a two-tiered market developing. Southern Pine plywood producers reported a quieter but decent week of sales overall. Those sales and most order files extending into the week of November 9 maintained mostly firm rated sheathing pricing. Sales activity in the Western Fir plywood remained dull, forcing mills to listen to offers more earnestly and accept deeper counters than in previous weeks. Buildups of some items kept downward pressure on prices. Canadian plywood activity slowed this week, as buyers digested volumes bought during last week’s little run. Buyers are considering the possibility of impending snow and, as order files shuffle into late November, are staying lean on inventory. Particleboard producers reported a slower to steady pace to the market. “Mediocre,” was one description of mill sales. Domestic MDF producers struggled with competition from offshore imports. Some price pressure continued, as prompt shipments remained available.

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