Market Recap: RISI Crow's Construction Materials Cost Index

A price index of lumber and panels used in actual construction for March 2, 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 mills reported a slower sales pace. Order files ranging from the middle of March out to the first week of April left pricing firm. Some quotes were raised slightly. Lumber futures backed off for much of the week, creating more restraint among buyers.

• Southern Pine price strength was less robust, but weakness remained largely limited to 2x6 and 2x10. Large volume sales of 2x6 at the end of the week prior absorbed mill excesses, allowing West zone producers to firm quotes. Strength in 2x4 persisted while producers continued to shift more production to that dimension.


• Moderate sales activity influenced Coastal species pricing in various ways. Producers exhibited greater degrees of urgency to move off green Doug Fir volumes, resulting in some discounted volumes. In dry, prices tended to hold more firmly and even gain a few dollars in some instances.


• The Inland lumber market exhibited little urgency. Most of the market viewed the situation as a digestive phase, content to let the situation sift out for a while before renewing what has become record-level pricing.


• Stud sales activity and tight supplies combined to maintain a firm to upward trend among most items, although not as strongly as the prior week. Buyers continued to look for 9’ coverage as supplies often remained scant. Cracks showed up more often in Doug Fir.


• Reports on Ponderosa Pine Shop lacked uniformity, some saying, “Shop is a little more expensive,” and others saying that 5/4 moved upward while 6/4 was flat. Availability of Ponderosa Pine Shop remained notably thin. Reports concerning Ponderosa Pine Selects and Commons showed a basically firm demand, but “no strong continuity.”


• Most of the numbers are flat. Sales activity at Western Red Cedar mills was solid. Demand levels prompted a few producers to begin considering demand-related price increases for the first time this year. Others introduced another round of increases for March.

Panels

Most sources reported diminished OSB activity, as buyers chased orders and pulled in their horns on purchasing with prices viewed as being near the top. Two-tiered markets were noted regionally, which led to further hesitation.

• Sales activity in the Southern Pine plywood market slowed. Mills entering the week with order files into the weeks of March 12 and 19 maintained those lead times through Friday morning. Opinions varied as to whether the slower pace was a “pause” or the beginning of “a period of price adjustment.”


• Western Fir plywood buyers were less active, limiting mill sales. Buyers picked off a few needs but considered the slower pace a sign of potential downside risk. Order files shortened, still ranging from the weeks of March 12 into March 26.


• With order files out to April 9 to 16, Canadian plywood remained slow this week. Buyers are cautious and chasing orders relentlessly with transportation still a mess.


• Signs of mild increases in particleboard and MDF demand persisted for another week. Eastern MDF producers reported the appearance of tighter supplies in that region. Meanwhile, particleboard producers in the East remained determined to lock in customers before the market experiences a major increase in production.

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