Key Lumber Items Still Hot
A down week in the futures market and wet weather across the country slowed the SPF market down. Futures is now a discount to cash and the run to $400 mill on 2x4 Western S-P-F, has stalled for the time being. Although demand has slowed, many prices still climbed higher. Studs were the anomaly, both 2x4 92’s and 2x4 104’s were hot last week, with both posting double digit gains. Sales of Southern Pine dimension also slowed last week, but prices still rose. Wet weather in the south slowed activity on jobsites and hampered logging efforts. Many items were still hard to find.
Photo courtesy flickr user: jurvetson
The Panel market showed no signs of a slowdown. OSB mills were able to extend order files and raise prices, especially on the thicker panels. 3/4" T&G has been the hot item in panels, gaining 15% in the last three weeks and more than 30% since the beginning of November. Availability has been a major concern for many who need prompt loads to cover jobs that are starting.
In summary, the dynamics of supply and demand for the housing industry have not changed. Demand is greater than supply for now. Weather has slowed things down a bit, but the underlying demand is still there. Once spring weather arrives, we could see a surge in demand that would take prices up another notch. Most traders are calling for higher prices in the coming months based the tone of the market today.