Market Recap: RISI Crow's Construction Materials Cost Index

A price index of lumber and panels used in actual construction for April 14, 2017.

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: Volumes of SPF lumber traded were very light. Buyers either chose to wait for the duty determination expected early next week before deciding their next move or were content with volumes purchased over the past few weeks. Exceedingly high mill quotes established with the anticipation of significant duties remained in play for May shipments, effectively shortening mill order files considerably. Sales activity in Southern Pine was more measured. After establishing order files of a couple of weeks for several items, producers continued to increase quotes, albeit more modestly than in previous weeks. Coastal species mills reported a slower sales pace as the week progressed, as buyers prepared for the lumber duty ruling next week by suspending participation in the market. In contrast to the previous three weeks, this was “a modest week” in Inland lumber. Reports from mills vary, at least in part depending on the volume of stock a producer might have available. Stud buyers refused to purchase at the higher prices being quoted for May shipment, but mills listened to offers on volumes available for high velocity rail shipments in April. Otherwise, stud buyers sat back and awaited the duty news expected early next week. Ponderosa Pine Mldg&Btr and Shop lumber are currently in a state of price appreciation. In boards, recent sales indicate that Ponderosa Pine #3 Common remains the strongest mover, with prices increasing about $10 across the board. Both #2 and #4 Common have added $5 to previous levels. Selects have been very stable. Canadian Western Red Cedar producers spent the week trying to transport as much lumber across the US border as possible prior to the duty determination expected April 24. Trying to move product over the border was not always easy, as transportation issues involving railcar and truck shipments persisted.

Panels: In a relative sense, OSB markets took a breather this week and slipped into a digestive mode. Despite the slowdown in pace, prices still made impressive gains this week. Southern Pine rated sheathing prices continued to move higher at an orderly pace. Escalating prices generated caution among buyers, but again, any hesitancy took a back seat to purchasing needs. Producers managed to move order files more firmly into the weeks of May 1 and 8. Sales slowed in the Western Fir plywood market. Availability for shipment in the week of May 1 remained in play, but some sales in May 8 did occur. While mills reported firm pricing, even managing to bump their prices a few dollars early, some mild counters of no more than $5 were also taken. Canadian plywood markets maintain their underlying strength, though this week was “pretty quiet,” sources said. Market drivers remain unchanged: Inventories are thin, wood is needed, and the US and Vancouver are buying Canadian panel. Some signs of improved demand for both particleboard and MDF appeared, particularly in the East. Prices for both items were steady.

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