AUGUST 2022 BUILDING MATERIAL MARKET REFLECTION
The commodity markets saw a slow but steady grind downward in pricing through the month of August. An announcement by West Fraser about some permanent mill curtailments pushed buyers off the fence to fill some immediate needs and allowed mills to build a small order file. As quickly as buyers stepped in, they retreated to the sidelines. With negative news on housing, interest rates and inflation in both Canada and the U.S. everyone is taking a cautious approach heading into the fall.
Lumber saw 10% -13% price decreases across all widths. With current business still being strong, buyers looked to cover short term needs while not feeling overly confident about the health of the market heading into the fall season.
OSB prices held for most of the month but finally succumbed to downward pressure the last couple of weeks. Showing a 10% fall in pricing on posted numbers, but pricing on the cash market showed a 15% decrease as a local Western mill looked to move production.
Plywood pricing was flat for the month but mill order files are shrinking and wholesalers looked to move contract loads to minimize the downward risk.
Truss order files continue to grow with production struggling to keep ahead of sales. With the U.S. market slowing joist is starting to look better heading into the fall. LVL continues to be an issue due to veneer shortages. All reports are, expect that to continue through the rest of this year.
Building materials are continuing to show some supply issues with LP Smart Panel and trim, exterior drywall and Tyvek housewrap, currently the three biggest challenges
Finishing products production continues to remain in good shape, with the only issues being the odd logistics’ problem.
Looking Through the Crystal Ball
At current prices we can expect mills to look at further curtailments, which could push buyers off the fence once again. With the fall historically being some of our busiest months and most suppliers running lean inventories to minimize downside risk, it feels like we could see one more significant buy in on the horizon.