Market Recap: RISI Crow's Construction Materials Cost Index for March 23, 2018

A price index of lumber and panels used in actual construction for March 23, 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

Activity in the SPF market was quiet. Traders pointed to industry gatherings, and especially the CLA convention in Montreal, for much of the sluggish pace. With traders away from their desks, producers exhibited little urgency to sell by cutting prices aggressively.

• Southern Pine sales at mills lagged production, forcing producers to discount most #1 and #2 items. Discounts of $10 took place in westside 2x8 and 2x10, where cuts were the deepest. Most other discounts across all zones were closer to $5.


• Significant weakness permeated the upper grades of Coastal species lumber. Having room to maneuver with prices, some producers lowered prices dramatically early and still experienced light sales activity. Others put a number on an item and then tried to negotiate a level.


• Inland lumber is “close to the bottom,” in the words of one source. Prices, however, continued to show the downward drag of buyers who are convinced that it has more to give. This resulted in a “hit-and-miss” week for both Fir-Larch and Hem-Fir.


• Mills lowered stud prices in most cases and with varying degrees of urgency. Eastern SPF producers considered the inability of western producers to ship much by railcar to be in their favor.


• “Ponderosa Pine industrials are firm,” said one manager, especially in 5/4 Shop, but also in 6/4, and Mldg&Btr has moved back up to previous prices. Gains of as much as $20 showed in reported prices of Shop. Some producers returned to the market with new runs of Ponderosa, reporting that it moved easily. In boards, Selects were unchanged, but some strengthening moves were made in Commons prices. Most significant changes occurred in #2 and #3 Common.


• Western Red Cedar buyers purchased solid volumes for second-quarter deliveries. Mills with prompter lead times still enjoyed 3- to 4-week order files. Some reordering took place where buyers had purchased early and weather remains cooperative.

Panels

A machine failure and subsequent mill outage in the southern United States nudged OSB markets to life this week. Buyers had backed away in response to toppy prices but came back to the table to bolster thin inventories. Mill pricing rose as much as $11 through most of the United States and Canada.

• Order files at Southern Pine plywood mills eroded, and discounts appeared in greater numbers. At the same time carload volumes of rated sheathing sold at considerable discounts, quotes for truckload orders declined moderately. Discounts were especially apparent in 1/2-inch 4 ply.


• Sales activity in the Western Fir plywood market continued at a pedestrian pace. Mills beginning the week with order files into the week of April 2 often remained there by the week’s end. Mills often quoted steady prices and gave “a friendly $5” here and there.


• The Montreal Wood Convention slowed Canadian plywood activity this week, as most players were away from their desks. Buyers checked shipments, and yards were reported busy. Mill level business was slow with order files out from the week of April 16 to the first week of May.


• Particleboard and MDF producers reported minor changes in market activity, which were positive in most respects. A few particleboard producers reported increased sales to cabinet manufacturers. Prices were steady.

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