MAY 2023 BUILDING MATERIAL MARKET REFLECTION

If we had to sum up the commodity market for May in one word, it would be “Apathetic.”  Mill curtailment announcements and significant forest fires raging throughout Alberta could not raise the pulse of the market and convince buyers to move away from lean inventory position.

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Lumber prices showed minor changes for the month with 2×4 (-1%) and 2×6 (-5%) and 2×8(-4%) and 2×10(-9%) remaining a bit softer. Studs settled for the month in a +3% to -3% range. Mill order files range from prompt shipment to 1-2 weeks depending on the item.

OSB finished last month strong but could not carry that momentum into May. Showing a modest increase of +5%. Mills have pushed order files through June so we can expect prices to stay flat for the next few weeks.

Plywood could not build off lasts months uptick, finishing with a -2% change month over month. Mill order files are currently out 1-2 weeks, a good indication we may see price decreases as mills look to build order files.

Truss orders picked up in May and look like they will be strong for June in the local market. EWP supply continues to be very good with no supply issues to report.

The supply chain continues to be particularly good in most products, outside of the odd logistical issue most products are arriving on the scheduled delivery dates. Exterior drywall supply continues to improve as well. We are seeing price decreases continue to hit the market as most raw material costs continue to go down.

Looking Through the Crystal Ball

With lumber curtailments and forest fires failing to excite the market, it’s added to the confusion of most mills and traders who are looking to find some traction in this sideways market. Buyers to continue to run inventories lean and play around the fringes looking for the best deals, knowing prompt shipment is readily available. Reports of an abundance of Euro wood in the U.S. seems to have stalled domestic pricing. Continued negative economic reports out of the U.S. also adds to the cautious approach by buyers. It seems to feel more and more like we could be staying in this narrow trading range for much of the summer if we don’t see a significant increase in demand or a significant decrease in supply. Many producers posted negative first quarter earnings, indicating they are trading at or below breakeven levels, which appears to set the stage for further curtailments.

FRAMING LUMBER

Lumber pricing continued its sideway trend with minimal movement in most items. Mills continue to have 1–2-week order files, allow buyers to run inventories lean and purchase just in time.

OSB

Showed modest increases for the month. Mills do have order files through June so we can expect pricing to remain flat through the next few weeks.

PLYWOOD

Could not find any traction on pricing ending May relatively flat. Mill order files were out to 1-2 weeks.

MAY 26, 2023 LUMBER MARKET REPORT HIGHLIGHTS:

• Framing lumber traders saw little energy due to the holiday weekend.
• Western S-P-F demand was slow which matched curtailed supply.
• The futures market mirrored the physical market.
• The stud lumber market was uneventful, leaving prices steady.

MAY 26, 2023 PANEL MARKET REPORT HIGHLIGHTS:

• OSB prices stayed steady across regions.
• Mills inquiries slowed as replenishment needs were low.
• The western plywood market became more active with an increase in order files.
• Canadian plywood saw slow trading as producers listen to counters.

*All Pricing is in CAD