Market Recap: RISI Crow's Construction Materials Cost Index

A price index of lumber and panels used in actual construction for April 29, 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: Early SPF lumber discounts found a floor, prices firmed and then began moving higher, ending the week well above earlier levels. News of a train trestle destroyed by fire that will affect lumber deliveries helped spur buying. Producers boasted order files extending out into the last days of May. Dynamics in Southern Pine left the market with more strengths than weaknesses. Sales in the field remained solid in regions where weather has not slowed consumption. Treaters and truss manufacturers purchased strong volumes, contributing higher prices. Coastal species prices were mixed. Competition with imports from Canada contributed to downward pressure on some prices while moderate increases in demand helped steady others. Inland lumber producers were uniform in their perception of the market this week: it was slow and dull. Price softening confirmed their assessments. Both Fir-Larch and Hem-Fir Std&Btr/#2&Btr lumber showed weaknesses, driven by lackadaisical responses from potential buyers to mill phone calls. Stud pricing firmed and managed to edge higher in a number of cases by Thursday. Other prices did not make it back to the prior week’s levels after early discounts. Traders gave an up-limit move in futures on Wednesday much of the credit for heightened sales activity. Radiata Pine pricing is still split between New Zealand sources and those in Chile, with both countries holding steadfastly to their Mldg&Btr selling levels at this point. Domestic Ponderosa Pine shows no lack of availability in any grade of Mldg&Btr or Shop, but prices have been quite consistent over the last few months, especially in Mdg&Btr. Among price gains in Ponderosa Pine #2 Common, 1x4 moved up $5 to $580. Demand for various Western Red Cedar products remained strong, with “no letup” in sales activity. Pricing remained strong across the board.

Panels: OSB markets slugged through another slow week, with pricing maintaining either a sideways direction from last Friday or picking up a few dollars, depending on the region. Western Canada showed the most strength as mill and delivered pricing climbed on moderate market activity and looming maintenance outages among producers. Price adjustments in the Southern Pine plywood market were generally moderate. Rated sheathing pricing, after firming the week prior, managed to creep a little higher in some instances. In others, mills discounted to move panels. Producers of Western Fir plywood reported a decent week of sales, often enough to move order files out another week. However, it again took lower CDX prices to gain that week. Canadian plywood markets slowed, digesting volumes picked up in last week’s fracas. The week ended with pricing one point above last Friday’s Crow’s net; however, most producers are quoting firm at two points over. Order files moved out to May 23 among most producers. In the East and South, particleboard sales remained stellar, leaving availability tight and allowing mills to enjoy month-long order files. Pricing was steady. MDF sales were steady to moderately improved and prices held. Thin MDF availability remained tight.

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