Market Recap: RISI Crow's Construction Materials Cost Index

A price index of lumber and panels used in actual construction for Jan. 24, 2014

*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: Moderate SPF trading for key items pushed prices available to buyers in different directions, although most remained firm or edged higher. Producers urging secondaries to ship their purchased volumes from mills forced a two-tiered pricing structure for some items. Enough demand and constricted availability of some items existed in the Southern Pine lumber market to propel most prices higher. Frigid temperatures again dipped into the South, creating more obstacles for those producers trying to catch up with orders. The Coastal species lumber market remained on firm footing – for the most part. Buyers participated in enough numbers to place modest to moderate upward pressure on most prices. Log prices limited production, forcing one producer to lay off workers. Inland lumber producers have had a busy week fielding phone calls. The buyer emphasis is clearly on narrows. Wides are suspect, and they have come off several dollars. A lack of substantial availability helped keep prices firm. Ponderosa Pine Shop and Mldg&Btr remain very firm, although the last week has seen clear indications of reduced Shop buying among key remanufacturers. Neither Shop nor Mldg&Btr have shown any weakness, although the market is at a temporary plateau. The strong demand that has existed for Ponderosa Pine #2 boards has given way to more muted demand for that line, being replaced by increased interest in #3 boards. Eastern White Pine remains very stable in price, and producers are keeping their core customers clearly in the forefront of any production projections. ESLP activity has been good. Sales activity at the mill level in the Western Red Cedar market remained steady. Buyers quibbled little over higher quotes from mills, placing more importance on access than price. 

Panels: Although neither OSB nor Canadian plywood markets show consistency, some clear changes took place. Some Eastern Canadian buyers report a solid uplift in their OSB activity, with an increase of $5 reported for that region. Mills are being proactive. Lackluster rated sheathing sales in the Southern Pine plywood market forced mills to negotiate with customers to move volumes. Weather remained an obstacle, constricting consumption. Freezing rain halted at least one mill’s production Friday. Western Fir plywood producers experienced another week of trying to grind out orders in a market lacking enough demand to absorb production. Producers began to define more clearly floor pricing for sheathing items. Friday morning activity, coupled with selling action at the WRLA show in Saskatoon, provided a good catalyst for Canadian plywood. The market remains indecisive as to the actual strength of the market. Particleboard mills continued to report improvements in the amount of demand and number of inquiries they are receiving, which began to increase last week. Improved MDF sales were also noted by some producers.

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