Market Recap: RISI Crow's Construction Materials Cost Index

Lumber: Another strong week of sales activity and limited availability at mills led to higher SPF lumber prices. North American demand influenced the market far more than any overseas orders taken. Increasing demand helped boost Southern Pine lumber prices higher and allowed other items, where prices had floundered, to gain more traction. Better weather in the Southeast, improved or steady demand from sectors such as truss manufacturers, and limited field inventories all contributed to the market’s solid feel. Producers reported strong sales in the Coastal species lumber market, as demand provided enough push to send prices higher. Having kept inventories lean, buyers came into the market to purchase replenishment volumes. Light inventory levels, both in the field and at the mills, added to the strength of the Inland species lumber market. Short production runs, log quality and availability, and good order files were all given as reasons for the shortage of available wood. Steady sales of Radiata Pine were reported and prices remained at or near published levels. Sales of Ponderosa Pine Shop grades continued to outpace Mldg&Btr. Producers reported the bulk of the activity was for the upper grades of Shop, particularly in 6/4. Ponderosa Pine #2&Btr board prices increased $5 for 1x4 and 1x6 and a $10 increase for 1x8 and wider was reported. Producers reported little trouble moving any tally of #2&Btr. Eastern White Pine producers reported another week of steady sales, as Premium grade in wide widths remained a sought after item. ESLP prices that were a premium to Ponderosa Pine kept some buyers looking for coverage elsewhere. Producers reported a lackluster week of sales in the Western Red Cedar lumber market. Although interpreted as “sluggish” by some producers, the sales pace was somewhat steady when compared to prior weeks.

Panels: In OSB, market activity improved in the North Central and western Canadian markets, with some follow-through in other regions. Mills in the southern regions did not see the same activity that their northern counterparts experienced. Sales activity levels increased in the Southern Pine plywood market and reached a crescendo Thursday. Thin order files at mills forced early discounts. Needing to replenish, a greater number of yards participated while wholesalers also saw lower prices as an opportunity. The Western Fir plywood market entered the week softly, but sales activity improved and reached a peak Thursday. A broad range of buyers entered the market to replenish scant inventories. Discounts offered early by Canadian plywood producers brought enough buyers off the fence to extend mill order files and firm prices. Reports of overall market activity varied, although much of the tone in both particleboard and MDF markets was lackluster. More buyers noted incoming calls from MDF producers looking to move additional volumes at discounted price levels.

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