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Market Recap: RISI Crow's Construction Materials Cost Index

 

A price index of lumber and panels used in actual construction for Aug. 12, 2011

*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: Slow sales activity in the SPF lumber market forced producers to lower quotes in search of buyers. Mills in the West exhibited greater urgency than those in the East to find price levels that might entice buyers to participate. Mill sales in the Southern Pine lumber market slowed to a crawl, creating spotty buildups at mills and subsequent discounts. Price weakness was also evident at the secondary level. Coastal species lumber mills struggled to sell production, but lower prices brought about enough buying to get close to moving output. Distributors were actively filling inventory holes. Overall, the Inland market was quiet for the week. The narrows in both Fir-Larch and White Woods seemed to be more vulnerable than the wides. Activity for Moulding and Shop was light, to start the week and never really got going. The prices of 5/4 Ponderosa Pine Mldg&Btr came off $5 and 6/4 moved down to $1,400, a $15 decline. Prices for Radiata Pine were softer as well. Reports of offers for volume purchases from importers were floating about, some well below last week's market levels. The market for Ponderosa Pine boards was quiet again. Idaho White Pine prices declined in both Sterling and Standard. Eastern White Pine producers reported sales of Standard 6-in. and 8-in. were good, but 12-in. was slow. The Western Red Cedar market remained mired in the summer doldrums, although the underlying issues with the market run much deeper. Market participants were reminded of this rather harshly, as they watched the stock market take a pounding.

Panels: Trading was sluggish in the Southern Pine plywood market, leading to mills having to fall back on order files extending into the week of Aug. 22 and 29. As a result of those order files, mills exhibited little initiative to lower prices, despite the light sales activity. "It's flat," was the phrase most used to describe the Western Fir plywood market, pertaining to both sales activity and prices. Availability of product from mills was usually in the week of Aug. 22 or sooner, depending on the item. The general feel of the OSB market was uneventful. In Canadian plywood, much of the sales were by secondary sources and not mills directly. The result was a two-tier market in some areas. There were some regional differences, but, for the most part, activity was sufficient to keep mill prices firm. Most particleboard producers and their customers seemed to have settled on prices for the near term after recent price increases. MDF prices remained stable.

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