By mid-March many regions across the continent faced yet another bout of bad
weather. Meanwhile the densely populated southern U.S. states ramped up
construction activity. Demand for lumber materials remained somewhat muted,
yet suppliers booked enough sales to keep prices generally even from the
previous week.
Sawmills claimed to have extended order files out to two weeks or so, but
resellers suspected this might be an exaggeration. However, the ability of
manufacturers to dismiss counter-offers suggested their order files would
stretch out that far soon enough. Transportation delays continued as harsh
weather remained for another week.
In the week ending March 17, the price of benchmark softwood lumber item
Western Spruce-Pine-Fir 2×4 #2&Btr KD (RL) was US$364 mfbm, which is down by
$1 or zero per cent, from the previous week when it was US$365 mfbm. This is
down by $91, or 20 per cent, from one month ago when it was $456.
Demand for standard dimension lumber improved a little, while sales of
panels continued to languish by comparison.
“The effects of winter weather still abounded, especially in production
regions where frigid temperatures persistently hampered timber harvesting
and log transportation.” — Madison’s Lumber Reporter
Amid a mushy market, Western S-P-F traders in the U.S. saw better sales
volumes in mid-March. Producers showed a little more confidence as they kept
asking prices at or on either side of the previous week’s levels. Despite
the banking tumult, buyers actively sought near-term coverage to fill holes
in their inventories. Players voiced their concerns that government
intervention in the financial system would negatively affect investment and
growth in the housing sector. Having done enough business to extend order
files into the first week of April, producers were decreasingly interested
in accepting counter-offers.
Western S-P-F lumber prices in Western Canada stabilized as suppliers
reported a more balanced supply-demand equation. Sales of low grade
continued to outperform standard and high grade. Industrial customers stayed
more active than those in the #2&Btr game. While the spring building boost
has yet to materialize, suppliers were more confident in its imminence due
to long-term forecasts showing warmer weather patterns in many key areas.
Demand for Eastern S-P-F panel market was much the same as the previous
week, with the added disincentive of tumbling plywood prices. Buyers smelled
blood and were happy to wait and see how much further this correction might
go. Oriented Strand Board prices were flat amid a tale of two markets; where
demand out of Eastern Canada remained snowed under for the time being while
several key markets south of the border were lumbering to life. Inventory
holders in Ontario and Quebec hoped for warmer weather to melt away the snow
piles eating up their yard space. Suppliers of OSB and plywood in Western
Canada didn’t have much new to report. Wholesalers and distributers in Lower
Mainland British Columbia were able to buy OSB cheaper than print levels for
the first time in several weeks. Prices of plywood meanwhile stumbled around
five points as producers approached their alleged early-April order files
and tried to drum up some interest. Late shipments were commonly reported.”
— Madison’s Lumber Reporter
Compared to the same week last year, when it was US$1,330 mfbm, the price of
Western Spruce-Pine-Fir 2×4 #2&Btr KD (RL) for the week ending March 17,
this price was down by $966, or 73 per cent. Compared to two years ago when
it was $1,040, that week’s price is down by $676, or 65 per cent.
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