After a sleepy end to last year, the manufacture, sale, and consumption of North American dimension softwood lumber in 2019 to date has bobbled to relative normalcy. The weekly lumber price newsletter Madison’s Lumber Reporter printed today on the wholesaler (producer or secondary supplier) price of benchmark softwood lumber commodity Western Spruce-Pine-Fir KD 2×4 #2&Btr at US$402 mfbm. Prices of this construction framing commodity lasted several weeks at $422. This week that price is down -4.7% compared to last week and to one-month-ago, and is down -26% from the same time in 2018, when it was US$540 mfbm.
Of particular interest to building materials suppliers, especially those dealing in wood products, is the latest data on the strength of the US real estate market for full-year 2018. Home buying-and-selling activity, with details like inventory and prices, are good indicators of looming construction projects. Canadian and US softwood lumber manufacturers — the sawmills — as well as wholesalers and secondary suppliers, carefully watch this data to gain an understanding of coming demand from their customers, the construction industry and home builders.
An excellent bellwether to future US housing activity, is the latest Home Equity Report from CoreLogic. This shows that US homeowners with mortgages (roughly 63% of all properties) have seen their equity increase by +8.1% year-over-year, representing a gain of nearly US$678.4 billion since 4Q 2017. (background here: https://madisonsreport.com/2019/03/06/us-new-home-sales-house-price-december-and-full-year-2018/). As well, the market value of owner-occupied real estate in the USA increased to US$25.6 trillion totally in 3Q 2018, US$298 billion more than 2Q 2018 and US$1,526 billion more than 3Q 2017, said the Governors of the US Federal Reserve System Wednesday.
Be ahead of these data releases! Don’t delay, this week’s softwood lumber market comment will be published to the website Monday morning.
* Madison’s Lumber Prices, delivered every Friday morning, are a good forecast indicator of US home builder’s current lumber buying activity ——> DETAILS— Madison’s Lumber Reporter www.madisonsreport.com
US Construction Materials Prices: January 2019
Construction materials prices in the US rose +3.3% from January 2018 to January 2019, according to the producer price index for inputs for multifamily residential construction, tracked by the federal Bureau of Labor Statistics . That’s more than twice the increase for the consumer price index, at +1.6%, over the same period.
However, price hikes for construction materials have slowed overall since the summer of 2018. The PPI had increased +8% over the 12 months that ended in June 2018.
The trendlines on this graph for benchmark softwood lumber commodities Western Spruce-Pine-Fir and Southern Yellow Pine KD 2×4 #2&Btr softwood lumber prices vs US Average Home Sales Price are amazingly similar:
Lumber Prices and US Home Building & Sales Data: 2018
US Median Sales Price for New Houses Sold also tracks very well against construction framing dimension softwood lumber prices. Remember you don’t have to wait two or three months to get an idea of what is happening with the important US real estate market Get Madison’s lumber prices directly to your desktop every Friday. US housing starts and home sales data plotted against Madison’s proprietary lumber prices show a fascinating picture.
Benchmark lumber commodities Western Spruce-Pine-Fir and Southern Yellow Pine KD 2×4 #2&Btr vs Median Sales Prices for New Houses Sold for USA 2007 – 2019
The below table details current benchmark construction framing softwood lumber prices against last week, the previous month, and one year ago:
SOURCE: Madison’s Lumber Reporter www.madisonsreport.com
Established in 1952, Madison’s Lumber Prices is your premiere source for North American softwood lumber news, prices, industry insight, and industry contacts. The weekly Madison’s Lumber Reporter publishes current Canadian and US construction framing dimension lumber and panel wholesaler pricing information 50 weeks a year and access to historical pricing as well.
Madison’s offers a variety of products to meet your information needs regarding the North American forest products industry including:
Madison’s Lumber Prices: https://madisonsreport.com/products/madisons-reporter/
Madison’s Heating Wood Pellet Prices: https://madisonsreport.com/products/madisons-north-american-heating-wood-pellet-price-report/
Madison’s British Columbia Coast Log Prices: https://madisonsreport.com/bc-coastal-log-prices/
Madison’s Forest Pulse: https://madisonsreport.com/products/forest-pulse/
Madison’s Canadian Sawmill Directory: https://madisonsreport.com/products/madisons-directory/