Buyer Reluctance Keeps Lumber Prices Lower


madisonsreport.com

Indeed, while recent lower prices did encourage customers to increase purchasing somewhat, actual sales volumes remained below the seasonal norm. Participants in the forest products industry and home building alike question what this means for looming US housing starts. Does this ongoing muted demand for lumber indicate that new housing construction will be slow again, as it was last year? It is important to note that across both Canada and the US the weather has not been much co-operating; as some regions had a big dump of snow even at the end of April. Elsewhere there was severe storm activity, which is a bit early compared to the seasonal average.

And, there is a very alarming early start to wildfires in the northwest — some of which were quite challenging to put out — so lumber industry players have a lot more questions than answers for the beginning of May 2024.


In the week ending April 26, 2024, the price of Western Spruce-Pine-Fir 2×4 #2&Btr KD (RL) was US$408 mfbm, which is flat from the previous week when it was $408, said weekly forest products industry price guide newsletter Madison’s Lumber Reporter.

That week’s price is down by -$44, or -10%, from one month ago when it was $452.

madisonsreport.com
The quiet week capped off a muted month of April, as commodity prices were flat to down. Plywood prices appeared to be approaching a bottom.
Madison’s Lumber Reporter

KEY TAKE-AWAYS:

  • Weak demand for Western S-P-F underscored a broader market trend.
  • Current prices made it easier to be a buyer than a seller, for the time being.
  • In the East, purchasers did bolster their depleted inventories in advance of expected spring building activity.
  • Southern Yellow Pine supply remained well ahead of demand; there was no appetite to put speculative wood on the ground.
  • Feeling no urgency to shore up their inventories, purchasers patiently held out for discounted material.
  • There was almost no pressure from downstream consumers on inventory holders, so keeping yard stock lean was a relatively safe gambit.
madisonsreport.com