Good Supply-Demand Balance Keeps Lumber Prices Flat

In mid-November the annual North American Wholesale Lumbermen’s Association gathering took many traders away from their desks to hob-nob with their colleagues, often determining between themselves the condition for lumber sales to the end of the year.

Madison's Benchmark Dimension Softwood Lumber Western SPF 2x4 Price: November 2022

As such, sales were slow but somewhat consistent, and prices remained steady. True winter weather came on in many parts of North America, causing the usual stall to construction activity and indeed sawmill manufacturing volumes. The past two years ended with some serious surprises, which propped up prices significantly at an unusual time of year.
Will something similar happen this year? Only time will tell.

Remaining flat from the previous week, in the week ending November 11, 2022, the price of benchmark softwood lumber item Western Spruce-Pine-Fir 2×4 #2&Btr KD (RL) was again US$490 mfbm, said weekly forest products industry price guide newsletter Madison’s Lumber Reporter.
This is up by +$28, or +6%, from one month ago when it was $463.

Adding to the quietude was a significant contingent of players absconding to Arizona to hobnob at the North American Wholesale Lumbermen’s Association Trader’s Market.

Overall demand took another step back as frigid weather patterns descended and many players absconded to Phoenix, AZ, for the NAWLA Trader’s Market.”

— Madison’s Lumber Reporter

Lackluster demand for Western S-P-F lumber and studs diminished further as the week wore on, according to traders in the United States. Buyers anticipated a softening market and held off, waiting to see where numbers would land after the NAWLA Trader’s Market wrapped up.
Field inventories remained extremely low, and sawmills showed limited availability of most dimension items and nine-foot studs. One veteran trader was convinced the market was sneaky strong due to that combination of scant supply and depleted inventories.
Sawmill order files were into the week of November 21st.

Madison's Benchmark green and KD Construction Framing Dimension Softwood Lumber Prices: November 2022

Suppliers of Western S-P-F in Canada described a market that was subdued by a sudden and fierce snap of cold weather across the Western provinces. Buyers were already showing next to no urgency as the previous week wrapped up, and demand tapered off even further. Distributors reported meagre takeaway.
Pickup and delivery timelines suffered for the first time in awhile as winter weather affected road conditions and rail service readiness.

“Demand for Western S-P-F studs was unremarkable as buyers scurried to the sidelines in response to inclement weather. Most appeared to be waiting to make any decisions about short-term coverage. Weak demand barely kept stud mills ahead of showing prompt availability, with order files in the range of two- or three-weeks.
Those buyers who were still active leaned on the distribution network, where they reported decent delivery times even as weather conditions worsened.”

— Madison’s Lumber Reporter

Madison’s Benchmark Top-Six Softwood Lumber and Panel Prices: Monthly Averages

Madison's Benchmark green and KD Construction Framing Dimension Softwood Lumber and Panel Prices: November 2022

Compared to the same week last year, when it was US$620 mfbm, the price of Western Spruce-Pine-Fir 2×4 #2&Btr KD (RL) for the week ending November 11, 2022 was down by -$130, or -21%.
Compared to two years ago when it was $590, that week’s price is down by -$100, or -17%.