Prices of some construction framing dimension softwood lumber items pushed up, even as benchmark commodity prices stayed flat.
While customers continued to be very cautious, preferring to only order wood for building projects ongoing, suppliers warned of potential looming shortages.
For their part, buyers were concerned that prices might fall — despite being quite flat for most of this year — thus were reluctant to stock up on inventory.
Producers, meanwhile, have been quite disciplined with keeping manufacturing volumes low, in line with this muted demand since mid-2022.
As the spring home construction season starts to come on, suggestions of low field inventories thus potential lack of supply seem valid.
In the week ending March 8, 2024, the price of benchmark softwood lumber item Western Spruce-Pine-Fir 2×4 #2&Btr KD (RL) was US$452 mfbm. This is flat compared to the previous week when it was $452, said weekly forest products industry price guide newsletter Madison’s Lumber Reporter. That week’s price is up by +$8, or +2%, from one month ago when it was $444.
Panel prices soared, amid widespread confusion. As rising demand outstripped limited supply, lumber and stud prices gained momentum.
As demand slowly improved Western S-P-F purveyors in the United States had much the same posture as they did the previous week. Inventory-holders with wood on the ground were in the driver’s seat, especially as dwindling availability gave buyers fewer options.
Rising demand for studs ran up against subpar supply, pushing prices up.
Many buyers tried to stay circumspect, but those who were slow to purchase missed out and usually ended up capitulating to higher prices. Even large secondary suppliers reported atypically low inventories.
Suppliers of Western S-P-F lumber in Western Canada noted a strong uptick in inquiry and takeaway of all product lines. Prices of standard- and high-grade numbers were flat to slightly up, with sawmills showing confidence in their positions as overall supply was perceived to be limited. In what many called the busiest week for dimension lumber sales so far in 2024, sales of narrows led the charge.
Late-March order files were widely reported by sawmills, even as another bout of winter weather in the West pressed pause on construction activity in several areas. Snowfall disrupted transportation in those same regions, but not to an egregious degree.
Traders of kiln dried Hemlock/Fir commodities were slammed with orders as buyers kept extremely busy. While demand continued to heat up palpably, producers extended their order files into late-March or early-April. Experienced players voiced their expectations of a good spring run given this recent surge in business. Those forecasts were lent more credence by the pervasive lack of material up and down the supply chain. Everyone from large suppliers to end users had lower-than-average inventories.
Madison’s Benchmark Top-Six Softwood Lumber and Panel Prices: Monthly Averages
