Market Recap: RISI Crow's Construction Materials Cost Index

A price index of lumber and panels used in actual construction for June 30, 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: Monday’s announcement of an affirmative antidumping duty determination had little influence on the SPF market. Producers in both the East and West fell back on order files extended into the latter half of July and raised quotes a few dollars higher in response to active market conditions. The protracted decline in Southern Pine prices continued. Mills managed to sell increased volumes of 2x6 and clean up excesses, prompting them to firm and even raise quotes. Yards continued to reduce inventories and purchase fill in volumes. Horrendous truck access persisted. Coastal species prices held or moved higher. Green Doug Fir 2x4 and 2x6 #2&Btr attained price levels not achieved since September 2004. While producers expected a slower pace toward the end of the week, with the approach of an extended weekend for many, some reported an uptick in demand Thursday morning. Inland producers agreed that this became “a strong week” for sales activity. The result was a few price increases, in both Fir-Larch and Hem-Fir, and softness in an item or two. Stud prices overall held firm or moved moderately higher again. Mills established order files extending into the middle of July while market fundamentals propelled prices higher. A reasonable balance between supply and demand has been reported in both Ponderosa Pine and Radiata Pine industrials, although one source noted that supplies of both were increasing, especially in Shop grades. Some weakness in Ponderosa Pine boards is now beginning to show, as home centers start to slow down with summer approaching. Idaho White Pine is even less available than usual this year, so finding consistent supply has been difficult for buyers. Western Red Cedar buyers continued to purchase hand-to-mouth and producers left most quotes alone. Cedar pricing held.

Panels: OSB markets gained an even more solid footing this week. Buyers came to the table after trying to wait out producers, anticipating price mitigation, which did not happen. The Southwest and Southeast regions remain the weakest for activity, due to frequent rains. After a sluggish start, Southern Pine plywood buyers stepped in Wednesday and Thursday to take care of business prior to the holiday week. A broad spectrum of buyers participated. The uptick in demand was only moderate, but producers achieved sales at moderately higher price levels. News of a veneer plant fire sent buyers into the Western Fir plywood market in search of coverage in case supplies tightened. The surge in interest prompted mills to raise prices to levels not seen at least for a couple of years and go off the market at various intervals from Tuesday throughout the remainder of the week. A fire at a US-based veneer drying facility poked a stick into an already volatile Canadian plywood market. The past weeks have been punctuated by price run-ups and order files pushing out almost six weeks. Both particleboard and MDF producers reported a steady or moderately slower sales pace. A seasonal slowdown was often cited for the more tepid pace. Others blamed the more immediate impact of the upcoming holiday.

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