Lumber Market Waffles on Price Points as Sales Take a Pause

Lumber Market Waffles on Price Points as Sales Take a Pause

Last week some sources found that lumber prices were still inching up. Others said sawmills were holding firm on price lists as they worked through extended order files, while wholesalers and secondary suppliers offered discounts to move wood.

Lumber futures were soft, with brisk trading of the May contract on moderate volumes.

In reality there were big price differences between species, between mills, between destinations. A huge lumber convention in Montreal, QC, and Spring Break across North America served to keep support staff busy.

Current Softwood Lumber Prices Compared to Recent and Historical Highs

SOURCE: Madison’s Lumber Reporter

The above table is a comparison of June 2017 and March 2018 prices for benchmark dimension softwood lumber 2×4 prices compared to historical highs of 2004/05:

It was a week for North American softwood lumber traders to take a breath and assess the market. For most, whether customer or supplier, it seemed the first consideration was inventory.

The Montréal Wood Convention last week in Québec provided a forum for players on both sides of the Canada/US border to discuss the most important aspects of the current supply-demand balance. Top of the list for everyone was ongoing serious logistics problems, particularly on the railways, plus the mechanisms and various intricacies of this latest softwood lumber duty.

Those manning trading desks last week found producers holding firm on prices, unless particularly motivated to move specific products, as sawmills worked through rather extended order files. Wholesalers and secondary suppliers were receptive to counter-offers but — again — only on items plentifully in stock.

Otherwise, most customers hesitated with buying generally in expectation that prices might soften.

Between spring break, Montréal, and slowly-arriving wood purchased in early February, this week was largely one of digestion mode for the lumber market.

WSPF KD R/L #2&Btr, WSPF KD PET Studs, Douglas fir Green: 2012 – March 2018

SOURCE: Madison’s Lumber Reporter


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