Market Recap: RISI Crow's Construction Materials Cost Index

A price index of lumber and panels used in actual construction for Nov. 26, 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: Traders reported a slower pace in the SPF market compared with the end of the week prior. Producers often approached the market on firmer footing with regard to pricing. Thanks in large part to improved sales activity at the end of the prior week, Southern Pine producers exhibited less urgency to sell compared to prior weeks. Discounts still appeared, but #2 pricing overall held up better. Buyers watched inventories closely. Traders reported “little sales activity” early Tuesday and expected minimal buying the rest of the short week. Coastal species pricing adjusted downward when at all. The depth of cuts and the item discounted often differed from mill to mill. Demand was light after mills reported a moderate pickup in sales late the week prior. Inland producers generally agreed with the source who stated, “Nobody’s home” when asked about the character of the week. Few changes occurred in any Fir-Larch prices, which have been quite stable. Stud buyers reported “flat to down” prices in an overall weak market. The market for 2x6 9’ remained stronger than others, but mild discounts appeared. Mills again struggled to sell 2x4 8’, with discounts as deep as $10 to $15 to move volumes. This week, Radiata Pine prices have been readjusted to reflect a broader consensus among producers, which involves some consideration of raw material sources. The situation does not lend itself to ready resolution, reflecting differing timber bases. Ponderosa Pine shows no changes in price of either Mldg&Btr or Shop. Western Red Cedar producers reported light and “spotty prompt business” while continuing to line up orders for the first quarter of 2016. Prices held up, with no real pressure in either direction.

Panels: OSB slowed in the US this week with the holidays. Markets were considered toppy. Pricing is flat to down slightly on the US, while in Canada the east side retains its strength and the west went quiet with prices off $10-15. Inventories are low in the field, and regional two-tiered markets have developed. Southern Pine plywood buyers showed limited interest in purchasing, producing a dull week for mill sales activity. A few producer reported “decent” or “steady” sales, while wholesalers purchased and sold light volumes. Mill quotes generally held at or very close to established market levels. Producers of Western Fir plywood experienced modest sales activity, as buyers tended to skate through the week needing few items. Some mills reported lead times extending into the week of December 7 but significant volumes remained available for the week prior. Canadian plywood demand is steady and markets uneventful. Pricing is unchanged from Friday’s Crow’s net level, and order files range from the weeks of December 7-21 (most landing in the middle). Buyers are eager for deliveries. Customers taking vacation during the week limited sales of both particleboard and MDF somewhat. Pressure on MDF pricing varied, with most of it in the East. Particleboard producers reported “steady pricing.”

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