Market Recap: RISI Crow's Construction Materials Cost Index

A price index of lumber and panels used in actual construction for Oct. 18, 2013

*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.

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Lumber: SPF market activity picked up Thursday, prompting producers to firm prices and even raise them in some instances. Week-long gains in the November futures contract, particularly the strong opening to Thursday’s board, brought buyers into the market. The Southern Pine lumber market was sloppier, as mills did what was needed to keep growing floor stocks moving. Wholesalers countered aggressively, took advantage of some of the deeper discounts and shorted the market. Buyers often looked for an opportunity to buy Coastal species lumber items at lower prices but found producers unwilling to cooperate in most instances. Buyers continued to want quick shipping volumes to cover immediate needs. The Inland species lumber market on Monday was described by some as dead. As the week progressed, market activity improved. Most of the activity was centered on Fir-Larch dimension. Activity for Radiata Pine Shop was light, with most sales at or near published levels. Limited offerings of Mldg&Btr kept prices for that item firm. In Ponderosa Pine, any excitement generated in the Industrial lumber market was by sales of #2 Shop, and even that was modest. The market for Ponderosa Pine #2&Btr Common continued its strong run-up. Limited supplies forced buyers to turn to secondaries for much of their coverage. Producers of ESLP #2&Btr reported steady sales of that product at published levels or slightly higher. Eastern White Pine producers saw a continuing strong market. Steady sales of both Industrial and Standard pushed mill order files out to early November. Focus among Western Red Cedar buyers and sellers was on both this year and next. Mills continued to book orders for shipment in November, but volumes were light and often heavily mixed. 

Panels: Inclement weather in some regions, along with holidays in both the U.S. and Canada, added to an already subdued OSB market. Producers touted order files into late October, or even early November in some instances. The Southern Pine plywood market lacked energy, leaving mills order files thin and prices susceptible to downward pressure. Buyers exhibited little interest in purchasing much volume at whatever price. Ample availability in rated sheathing remained in place for the week of Oct. 21. Western Fir plywood mills struggled to find price levels that would entice buyers to purchase greater volumes. Negotiated price levels usually depended on volumes, with some mills open to lowering prices considerably even for highly mixed truckloads. For the second week in a row, Canadian plywood prices weakened early then firmed back up by week’s end. Distributers reported a wide range of prices depending on the time of the week the purchase was made. The overall tone of the particleboard market in the East continued to fade. While some producers have already adjusted production schedules to meet declining demand, in both particleboard and MDF, others are now considering the same move.

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