JULY 2021 BUILDING MATERIAL MARKET REFLECTION
Lumber prices continued to erode throughout July, finally hitting a bottom towards the end of the month. With some mills announcing production curtailments and the ongoing threat of forest fires, combined with the massive price adjustment gave some buyers the confidence to come back into the market. Plywood and OSB pricing have now started their correction as well with large pricing concessions being seen each week through July. Mill order files that we were previously projected to reach into the 4th quarter of 2021 it seems were based on contract sales, that we are hearing through the grapevine have been cancelled. This decimated order files and brought large volumes of prompt product to the marketplace.
The story on Engineered Wood products has not changed much. Volume allocations continue to limit availability on Joist, Beams and Rimboard. We are seeing availability on plates and hangers improve with some allocations coming off products, which is good news to truss manufacturers. MDF supply issues continues to have a massive impact on the finishing market, affecting baseboard and casing. Delays caused by ocean freight and back logs at the ports on raw materials do not look to be going away anytime soon.
FRAMING LUMBER
Lumber continued its epic price correction through July, finally finding a bottom towards the end of the month. Even with the threat of curtailments and forest fires the market seems to have stabilized at best. Suppliers are working down their higher priced inventories before looking at any significant volume buys. This trend will continue as long as prompt product is available.
| R/L | JUNE 25, 2021 | JULY 3O, 2021 | +/- |
|---|---|---|---|
| 2×4 | $1,077 | $655 | -$422 |
| 2×6 | $1,077 | $592 | -$485 |
| 2×8 | $1,108 | $574 | -$534 |
| 2×10 | $1,293 | $599 | -$694 |
| 2×12 | $1,736 | $1,073 | -$663 |
| STUDS | JUNE 25, 2021 | JULY 30, 2021 | +/- |
|---|---|---|---|
| 2×4 – 92 5/8“ | $1,083 | $449 | -$634 |
| 2×4 – 104 5/8“ | $1,139 | $642 | -$497 |
| 2×6 – 92 5/8“ | $1,077 | $636 | -$411 |
| 2×6 4/8“ | $1,354 | $773 | -$581 |
OSB
OSB has started its retreat on pricing. Look for it to be a record-breaking adjustment similar to lumber. It will be interesting to see where pricing settles with added production coming online with Louisiana Pacific’s mill opening in July and two other mills scheduled for 2022. It looks like the supply demand imbalance had been corrected. But did it overcorrect?
| OSB | JUNE 25, 2021 | JULY 30, 2021 | +/- |
|---|---|---|---|
| 3/8″ | $1,915 | $665 | -$1,250 |
| 7/16″ | $1,915 | $665 | -$1,250 |
| 15/32″ | $1.935 | $685 | -$1,250 |
| 19/32″ | $2,280 | $1,120 | -$1,160 |
| 23/32″ | $2,434 | $1,275 | -$1,160 |
PLYWOOD
With order files going into the 4th quarter the plywood market looked to be set for the year. But with retail sales coming to almost a complete stop and contracts being cancelled plywood mills find themselves with no order files and product to sell.
| PLYWOOD (STD) | JUNE 25, 2021 | JULY 30, 2021 | +/- |
|---|---|---|---|
| 9.5 (3/8) | $1,660 | $867 | -$793 |
| 12.5 (1/2) | $2,213 | $1,156 | -$1,057 |
| 15.5 (5/8) | $2,767 | $1,445 | -$1,322 |
| 18.5 (3/4) | $3,320 | $1,734 | -$1,586 |
| 25.5 | $4,986 | $2,607 | -$2,379 |
ENGINEERED WOOD PRODUCTS
With lumber pricing stabilizing truss manufacturers are working through their higher priced inventory to bring prices back in line. Order files are still strong ranging from 4 weeks to 12 weeks and that looks to continue heading through the end of the summer and into the fall. EWP continues to be the bottleneck for the industry throughout North America. All indicators point to this continuing into the second half of the year.
FINISHING PRODUCTS
With allocations still in place with many items in the finishing world the struggle continues for suppliers. MDF products like Casing and mouldings along with drywall are presenting significant challenges within the industry.
Framing Lumber Composite Price
AUGUST 6, 2021 LUMBER MARKET REPORT HIGHLIGHTS:
- A quieter tone emerged in many lumber markets after showing signs of solidifing the prior two weeks.
- Buyers refrained from purchasing amid an overall sense that supplies had caught up and were exceeding demand.
- Weakness far outweighed any gains through the week and the Random Lengths Framing Lumber Composite Price fell for the 11th consecutive weekly drop.
- Buyers continued to focus on lowering higher-priced inventories.
- Buyers avoided replenishment, noting that current prices were not low enough to generate overall inventory cost averages that were even close to the market.
| This Week | Last Week | Year Ago | |
|---|---|---|---|
| FRAMING LUMBER COMPOSITE PRICE | $579 | $597 | $841 |
| 2×4 #2&BTR KD Western S-P-F | $613 | $655 | $848 |
| 2×6 #2&BTR KD Western S-P-F | $557 | $592 | $832 |
| 2x4x9′ Studs | $670 | $692 | $845 |
| 2x6x9′ Studs | $795 | $842 | $812 |
| 2×10 #2&BTR KD Western S-P-F | $676 | $723 | $949 |
2020-2021 FRAMING LUMBER COMPOSITE PRICE
Structural Panel Composite Price
AUGUST 6, 2021 PANEL MARKET REPORT HIGHLIGHTS:
- The downward fall in structural panel prices remained intact, although there were spots of optimism.
- OSB producers noted an increase in inquiries, and some in the North were able to book block business, but prices continued to tumble by triple-digit increments.
- Sales of rated Southern Pine sheathing plywood picked up markedly in the second half of the week, and some producers bounced prices off their lowest levels.
- Demand for western Fir plywood remained at a standstill, prompting producers to probe for trading levels.
- Canadian plywood traders turned more bearish as prices continued to decline in large increments.
| This Week | Last Week | Year Ago | |
|---|---|---|---|
| ORIENTED STRAND COMPOSITE | $734 | $901 | $738 |
| 3/8″ 4×8 OSB | $515 | $665 | $655 |
| 23/32″ 4×8 OSB T&G | $1,125 | $1275 | $915 |
| 3/8″ 4×8 Spruce Plywood | $734 | $867 | $622 |
2020-2021 ORIENTED STRAND BOARD COMPOSITE PRICE
*All Pricing is in CAD