Unrecognizable Softwood Lumber Market Has Players Stymied

As Canadians came back to work after the Victoria Day long weekend and Americans got ready for their Memorial Day long weekend, actual purchasing of North American softwood lumber products slowed last week. For producers, the only interest was in selling wood currently on-hand rather than booking sales to extend their already-plump sawmill order files.

Prices remained elevated.

However the backlog of wood has started to move on the railways. Over this early-season work break, more long-awaited supply is going to arrive. By the time Americans are back to work next week Tuesday, there will have been a restructuring of inventories.

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

SOURCE: Madison’s Lumber Reporter www.madisonsreport.com

Current Softwood Lumber Prices Compared to Recent and Historical Highs

SOURCE: Madison’s Lumber Reporter www.madisonsreport.com

North American softwood lumber market participants could only gape in total amazement as demand from the US, and indeed elsewhere, continued unabated.

Bizarre trading activity on the lumber futures board of the Chicago Mercantile Exchange had some shocking rumours circulating. Opinions on this abounded, and none were mild.

There was some very difficult news about the loss of timber supply for British Columbia operators affected by the terrible wildfires of 2017, as explained in your Reporter last week. This week we have an update to that, and it’s not pretty.

The latest data detailing the loss of timber plantation can be found on Page 9 and 10 your weekly Madison’s Lumber Reporter.