As The Us Thanksgiving Holiday Approached, Which Usually Marks The End Of
Significant-Volume Lumber Sales For The Year, Ongoing Limited Supply And
Hungry Customers Kept Wood Prices Higher.
After the severe volatility of the previous couple of years, the trendline
for lumber prices through 2023 was quite stable indeed. This provides
sawmills with the ability to make plans for the next coming building season,
in spring of 2024. As the series of unknowns and unprecedented events are
behind us, this stability is quite welcome, by lumber sellers and buyers
alike.
Expectations for next year are a return to “normal”, and none too soon.
Considering production curtailments,
shift adjustments, and extra holiday time off, there was a prevailing sense
of limited supply going forward.
In the week ending November 17, 2023, the price of Western Spruce-Pine-Fir
2×4 #2&Btr KD (RL) was US$404 mfbm, which is flat from the previous week,
said weekly forest products industry price guide newsletter Madison’s Lumber
Reporter.
That week’s price is up by +$20, or +5%, from one month ago when it was
$384.
Strengthening demand permeated most of the North American lumber market,
while prices of panels were flat but firm.
Western S-P-F suppliers in the United States were well-positioned heading
into the US Thanksgiving Holiday. Prices were firm, supply was relatively
tight, and lead times were into late November at a minimum. As players
returned from the hobnobbery of the NAWLA Trader’s Market that took place
the previous week, the attitude related was neutral to bullish according to
many.
The market was apparently underbought at all inventory levels, from end
users to distribution to brokers. Several accounts had buyers starting the
week by aggressively pestering suppliers about shipping information, asking
where was the wood they had previously ordered.
There were many consequent reports of customers buying into 1Q 2024 to get
ahead of scant availability, rising prices, and potential winter disruptions
to the transportation network.
Demand and takeaway of Western S-P-F lumber in Canada was solid again.
However, there was a disordered feel to the market early on as the Canadian
Remembrance Day holiday fell on a Saturday, resulting in some companies
taking the Friday off and others taking the Monday.
The latest round of price increases at the sawmills had caused some
trepidation among buyers, so producers kept their numbers flat for the most
part to avoid any further bouts of sticker shock. Secondary suppliers,
meanwhile, remained busy as many customers turned to the distribution
network to keep the wolf at the door regarding their lean inventories. Mills
maintained order files in the range of two- to four-weeks, depending on the
source and item. In transportation, abundant truck availability and minimal
disruptions were reported.
Sales of Kiln-Dried Douglas-fir continued to improve inch-by-inch according
to traders in the United States. Reloads stocked with Hem/Fir reported solid
business throughout the week, as buyers endeavoured to cover their near-term
needs in advance of the American Thanksgiving holiday. With order files
pushing into late-November, many folks were thinking about securing volume
into early-2024, since extended holiday shutdown schedules remained a common
discussion among the mills. A recent rash of takeaway from big box retailers
put the squeeze on KD fir stud availability, which was already tight due to
quiet curtailments and shift adjustments.
Compared to the same week last year, when it was us$490 mfbm, the price of
western spruce-pine-fir 2×4 #2&btr kd (rl) for the week ending november 17,
2023 was down by -$86, or -18%.
Compared to two years ago when it was $620, that week’s price is down by
-$216, or -35%.
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