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Market Recap: RISI Crow's Construction Materials Cost Index

4/20/2015

A price index of lumber and panels used in actual construction for April 10, 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: Some SPF producers reported improved activity over last week and sales keeping up with the week’s production, but it did not stop prices from falling significantly. Yards continued to report improving demand, especially where winter hit the hardest. Cracks in some Southern Pine dimension lumber prices became more prominent. Other prices held or edged higher, leaving them mixed overall. Demand remained a step behind mill output, generating more buildups at mills. The Coastal species market became increasingly frustrating for traders. Traders noted that the market remained liquid but was also overproduced. They also suggested that upcoming downtime announced by mills throughout the week seemed to be the only action that will keep prices from falling further. Inland prices continue to be weak in Std&Btr/#2&Btr lumber, with uppers following along. Few stud prices were immune to the downward pressure. While some prices eased $5 lower, others plummeted $20. Spring rains pelting much of the country continued to limit consumption. Yards continued to stress the need for drier weather to boost demand. Radiata Pine is quite stable. The Mldg&Btr and #2 Shop are readily taken by contract users, and #3 Shop is not available in stressful volumes. In almost all instances, the Ponderosa Pine market has not loosened enough to cause major price reductions. One notable exception to this is Ponderosa Pine P99, which continues to retrench a few dollars. Ponderosa Pine board producers have attained a degree of success by merely holding their numbers on both Selects and #2 Common. Eastern White Pine and Inland Cedar are also lackadaisical and show unchanged prices on the week. As weather has improved, so has Western Red Cedar consumption. However, wet weather in the South continued to limit takeaways from those yards. Although pull-through at yards has telegraphed back to mills, several producers said the level of buying is not yet where it should be.


Panels: Very little activity occurred in the OSB market over the week, though some pockets did pick up business at the retail end as spring weather improved. Volumes at yards and reloads are high. Southern Pine rated sheathing sales activity remained sluggish, prompting a few mills to stack plywood in hopes of the market returning sooner rather than later. Other producers approached the market with the intent to sell at whatever price it took, within reason. Sheathing prices in the Western Fir plywood market were a bit soft. Mills often held sheathing quotes near last week’s market levels and sometimes negotiated prices $5-10 for slower moving items. Much of the demand was for truckloads. Canadian plywood markets are in a waiting game, currently, as the supply chain is full of panels and weather is just starting to break for jobsites. Pricing continued its slow decline, ending the week two points down from last Friday’s level. Order files remained bloated among particleboard producers in the East and South. MDF sales were steady in both the East and West.


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