RISI Crow's Market Recap
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: A lack of interest among buyers placed increasing downward pressure on SPF prices. Wet weather in Texas and the Carolinas restricted consumption in those pockets, and a November futures contract significantly below cash levels kept buyers on the sidelines. Southern Pine price trends continued as demand for most items lagged production. For yet another week, 2x4 showed strength while weakness in other widths varied. Traders kept an eye on Hurricane Florence and its possible repercussions as the week progressed. How the storm might influence production, consumption and log supplies were concerns. Sluggish sales activity increased downward pressure on Coastal species prices. Buyers perceived no reason to purchase more than immediate needs, which forced producers to seek sales at significant discounts at times. Traders expressed disappointment in the market following Labor Day after hoping the post-holiday market would show some semblance of improvement. Inland lumber activity slowed further this week, putting an anchor on many of the Std&Btr/#2&Btr prices. Buyer caution stemmed from seasonal influences, as well as ongoing competitiveness among Canadian sellers. Stud prices were among the most widely and deeply discounted items across lumber markets during the week. Traders were keenly aware of the sizable gap between cash and November’s future contract. Buyers purchased immediate needs cautiously, shying away from taking a position because of downside risk. Ponderosa Pine Industrial lumber shows no lack of availability, but neither is it grossly oversupplied. The time of year, however, and the fact that some millwork plants will be moderating their purchasing soon, could change that picture dramatically. Ponderosa Pine Selects and Commons showed a lack of good energy, but both producers and wholesalers commented that #2 Common boards generally held their trading levels. Three Common, however, were much spottier, ranging fairly widely in price and being termed “widely discounting.” Western Red Cedar producers reported steady albeit lackluster sales activity. Buyers continued to fill-in inventories with truckload volumes consisting of heavy mixes.
A price index of lumber and panels used in actual construction for Sept. 7, 2018.
Western: regional species perimeter foundation
Southern: regional species slab construction
Panels: The big buzz around OSB markets this week concerned Hurricane Florence, which Friday churned chaos in the Carolinas. Activity picked up in the Southeast and Mid-Atlantic regions, but positions were limited and buying quieted by Thursday. In response to Hurricane Florence, the Southern Pine plywood market picked up momentum. By Tuesday, producers were already selling rated sheathing at significantly higher price levels and extended order files into the first week of October. Producers limited offerings and allocated volumes, trying to keep panels flowing to direct customers. Western Fir plywood trading improved, allowing producers to solidify order files. The degree in which sales activity expanded was evident in prices, which adjusted lightly. Producers reported the best week of sales in more than a month. Canadian plywood markets drifted in the doldrums this week, with mills trying to entice buyers with discounts. Little was done, however, as the market sought a level. “Files are short, buyers indifferent,” a trader said. Again, the West was stronger than the East. Sales remained solid in both MDF and particleboard markets. Over the late summer, some producers have struggled to keep order files from extending beyond what customers like to see. Producers reported selling steady volumes to a variety of customer segments.
Lumber: A lack of interest among buyers placed increasing downward pressure on SPF prices. Wet weather in Texas and the Carolinas restricted consumption in those pockets, and a November futures contract significantly below cash levels kept buyers on the sidelines. Southern Pine price trends continued as demand for most items lagged production. For yet another week, 2x4 showed strength while weakness in other widths varied. Traders kept an eye on Hurricane Florence and its possible repercussions as the week progressed. How the storm might influence production, consumption and log supplies were concerns. Sluggish sales activity increased downward pressure on Coastal species prices. Buyers perceived no reason to purchase more than immediate needs, which forced producers to seek sales at significant discounts at times. Traders expressed disappointment in the market following Labor Day after hoping the post-holiday market would show some semblance of improvement. Inland lumber activity slowed further this week, putting an anchor on many of the Std&Btr/#2&Btr prices. Buyer caution stemmed from seasonal influences, as well as ongoing competitiveness among Canadian sellers. Stud prices were among the most widely and deeply discounted items across lumber markets during the week. Traders were keenly aware of the sizable gap between cash and November’s future contract. Buyers purchased immediate needs cautiously, shying away from taking a position because of downside risk. Ponderosa Pine Industrial lumber shows no lack of availability, but neither is it grossly oversupplied. The time of year, however, and the fact that some millwork plants will be moderating their purchasing soon, could change that picture dramatically. Ponderosa Pine Selects and Commons showed a lack of good energy, but both producers and wholesalers commented that #2 Common boards generally held their trading levels. Three Common, however, were much spottier, ranging fairly widely in price and being termed “widely discounting.” Western Red Cedar producers reported steady albeit lackluster sales activity. Buyers continued to fill-in inventories with truckload volumes consisting of heavy mixes.
A price index of lumber and panels used in actual construction for Sept. 7, 2018.
Western: regional species perimeter foundation
Southern: regional species slab construction
Panels: The big buzz around OSB markets this week concerned Hurricane Florence, which Friday churned chaos in the Carolinas. Activity picked up in the Southeast and Mid-Atlantic regions, but positions were limited and buying quieted by Thursday. In response to Hurricane Florence, the Southern Pine plywood market picked up momentum. By Tuesday, producers were already selling rated sheathing at significantly higher price levels and extended order files into the first week of October. Producers limited offerings and allocated volumes, trying to keep panels flowing to direct customers. Western Fir plywood trading improved, allowing producers to solidify order files. The degree in which sales activity expanded was evident in prices, which adjusted lightly. Producers reported the best week of sales in more than a month. Canadian plywood markets drifted in the doldrums this week, with mills trying to entice buyers with discounts. Little was done, however, as the market sought a level. “Files are short, buyers indifferent,” a trader said. Again, the West was stronger than the East. Sales remained solid in both MDF and particleboard markets. Over the late summer, some producers have struggled to keep order files from extending beyond what customers like to see. Producers reported selling steady volumes to a variety of customer segments.