Market Recap: RISI Crow's Construction Materials Cost Index

A price index of lumber and panels used in actual construction for May 25, 2012

*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: Trading was subdued in the SPF lumber market, but a lack of supply available for quick shipment placed upward pressure on some prices. Eastern mills were more inclined to bump prices higher, although prices for a few items in the West were also elevated. High Southern Pine lumber prices and the cautious approach among buyers toward them and longer mill lists contributed to a decrease in demand in the market. Dimension prices were narrowly mixed, with flat pricing and $5 declines outnumbering increases. Moderate sales activity was enough to maintain steady price levels in the Coastal species lumber market. Midweek sales improved for some producers, as buyers filled needs prior to taking off for the long holiday weekend. Late shipments, broken tallies and long order files at Inland mills added to the frustration of buyers this week. Shipments that were two to three weeks late forced buyers to turn to secondaries to cover their immediate needs. Millwork producers found Radiata Pine Mldg&Btr in short supply. Steady sales of Ponderosa Pine #3 and P99 to door and window producers kept prices for those items firm. Sales of Mldg&Btr were light, but producers held their price. Inland producers of Ponderosa Pine Selects and Commons reported a slower, but still steady, pace to the market. Limited supplies of certain lengths and widths kept buyers looking and mill prices firm. Idaho White Pine board producers reported that light but steady sales kept prices firm. ESLP board sales volumes quieted, as buyers absorbed previous purchases. Eastern White Pine producers continued to enjoy active inquiries and sales. Some Western Red Cedar buyers have been slow to respond to tighter availability in the market, tending to use the prior few years as a benchmark for the current marketplace.

Panels: Two back-to-back weeks with holidays had a slowing effect on OSB markets. Order files into mid- to late June enabled producers to hold prices and, in some instances, move them up. Buyers stayed on the sidelines unless a real need existed. Southern Pine producers experienced enough sales activity to post order files extending into the week of June 11 for many items. Beyond that week, buyers showed little interest in purchasing. A moderate sales pace in Western Fir plywood and limits on how much CDX supply was available to buyers kept upward pressure on prices. Canadian plywood buyers returned from the long weekend and resumed the buying pace of last week. Mill order files out to the week of June 25 were reported, and some mills were even quoting into July. Any decline in particleboard or MDF sales was usually blamed on the week being situated prior to the long holiday weekend. Otherwise, most market players carried an optimistic outlook as the summer months approached.