Market Recap: RISI Crow's Construction Materials Cost Index

A price index of lumber and panels used in actual construction for March 11, 2016

*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 experienced good follow-through from the prior week’s late push, triggering price increases early. By the week’s end, offerings from mills were spotty. Order files extended out into the end of the month and early April. Southern Pine producers reported solid sales activity, although most made a point of noting demand was “not great.” Heavy rains in a large part of the Southeast flooded areas and made job sites a mucky mess. The longevity of upward pricing for some items in Coastal species encouraged some buyers to ready themselves for a potential turn downward. Much of the immediate caution revolved around dry Doug Fir, which showed some weakness. A more sedate pace in Inland lumber distinguished the week from the prior two, which were both more energetic with regard to demand and sales volume. Even so, prices for some items moved up very slightly in some cases. Stud prices were mixed, but most prices held or pushed moderately higher. Dry Doug Fir pricing experienced some weakness, moving $5 lower across a few items. Radiata Pine prices are quite stable, although Mldg&Btr from New Zealand still has some upward push because of pruned log prices. Ponderosa Pine Mldg&Btr lumber is not readily available, but major buyers who want or need it can find it without difficulty. Ponderosa Pine boards have firmed significantly over the last few weeks. Reduced production has come in the form of at least one closure and a reduction in hours by other producers. Much of the discounting that took place in earlier weeks has dried up. Western Red Cedar sales continued at a steady and solid pace. Producers carried strong order files. Buyers found it more difficult to locate their exact needs.

Panels: The OSB market softened further this week, and mills got aggressive with discounts to move order files out. Sources feel further downside to the market. However, deep discounts taken midweek dried up by Friday and the market firmed roughly $5 off from last week. Steadiness has been a primary characteristic of the Southern Pine plywood market over the past several weeks, and this one was no different. Lead times moved into the week of March 21. Several producers managed to sell volumes at moderately higher price levels. Significantly better sales activity produced the biggest one-week sheathing price gains in the Western Fir plywood market this year. Increases were even bigger when considering some producers offered sizable discounts early in the week. Canadian plywood markets lurched forward this week, striking a decidedly different (and more positive) tone. Buyers sensed a bottom and jumped in to pile down a little wood, taking activity beyond the entrenched hand-to-mouth mode. Particleboard sales in the East remained strong. Mills continued to carry extended order files, and buyers are finding availability more challenging. MDF sales remained stagnant overall, with imports still very competitive. 

For more on RISI, click here.