Ongoing harsh winter weather and ample supply of lumber inventories in the
field served to keep prices stable in North America. It seemed that only the
sawmill downtime and curtailment announcements of recent weeks – and months
– kept lumber prices from falling lower. The balancing act of keeping
manufacturing volumes in line with demand was made even more murky than
usual by adequate supply, especially at resellers. Wholesalers and reloads
in particular had sufficient wood available to satisfy customer inquiries.
As such, actual sawmill sales were limited thus prices remained flat.
In the week ending February 17, 2023, the price of benchmark softwood lumber
item Western Spruce-Pine-Fir 2x4 #2&Btr KD (RL) was US$470 mfbm, which is
down by -$6 or -1%, from the previous week when it was US$476 mfbm, said
weekly forest products industry price guide newsletter Madison’s Lumber
Reporter.This is up by +$98, or +26%, from one month ago when it was $373.
The distribution network got a little frantic in an effort to shed excess
material, apparently selling well-below replacement levels to clean up their
inventories.
While lumber mills maintained robust order files for the most part, the
solid wood commodities market experienced no significant changes in either
pricing or demand.
In mid-February, demand for Western S-P-F commodities was lacklustre. Buyers
retreated to the sidelines, having covered their most pressing needs during
late-January and early-February. Even with large volumes of overall supply
taken out of the equation by sweeping closures and curtailments among WSPF
producers, overbought position of many customers showed just how quickly
winter inventory needs can still be met or exceeded. Meanwhile, sawmill
order files were no further out than the first week of March.
Players reported a promising start to Western S-P-F trading, following an
uncertain end to the previous week. Buyers were patient with their
purchases, calling sawmills and secondaries multiple times to find their
preferred mixes and tallies. They were often disappointed; as producers’
offer lists were thin and wholesalers didn’t have much better selections.
Field inventory levels were apparently satisfactory however, evidenced by
diminishing customer activity as the week wore on. Producers leaned on order
files into early-March.
In contrast to the flatness in the rest of the Hemlock/Fir complex, prices
of green Douglas-fir commodities took a tumble. At least, that was the case
in dimension, while studs were unchanged from the previous week’s levels.
Buyers were quiet again, leading producers to bring some numbers closer in
line with other Hem/Fir categories. Those price corrections did little to
cajole customers however, with sales activity only worsening as the weekend
approached. Sawmill order files were into the week of March 6th.
Compared to the same week last year, when it was US$1,230 mfbm, the price of
Western Spruce-Pine-Fir 2x4 #2&Btr KD (RL) for the week ending February 17,
2023 this price was down by -$760, or -62%. Compared to two years ago when
it was $992, that week’s price is down by -$522, or -53%.
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