MAY 2026 BUILDING MATERIAL MARKET REFLECTION

Building Material Market Overview

The dimensional lumber market remained stable through May and into early June, supported by steady replenishment activity and selective inventory building across both Canada and the U.S. Canadian confidence improved modestly, led by stronger activity in Eastern markets, while Western Canada remained more nuanced as negotiated pricing continued to differ from posted mill lists. Overall, the market appears to have found firmer footing heading into June, with the overall market tone positive yet measured and many participants viewing current levels as a near-term floor

Canada Housing Starts

Western SPF Lumber

• Western SPF stabilized in May, supported by steady replenishment buying and modest positive momentum.
• Pricing remained negotiation-driven, with actual transactions often differing from posted mill lists.
• Secondary market competition eased, as pricing ranges narrowed and the market appeared less oversupplied.

Oriented Strand Board (OSB)

• Western Canadian OSB remained quiet and stable in May, with flat print pricing and limited market movement.
• Buyers relied mainly on contract volumes, supplementing only as needed with small cash-market purchases.
• Supply and demand stayed balanced, with limited cash availability, 3-to-4-week lead times, and no clear near-term price direction.

Plywood

• Western Canadian plywood softened through May, with price discovery active and values gradually moving lower.
• Buyers remained cautious, purchasing mostly hand-to-mouth while avoiding larger inventory positions.
• Mills held near print where possible, supported by mid-June order files, though further modest price depreciation remained possible.

Engineered Wood Products (EWP)

• Engineered Wood Products faced broad-based price increases from all producers, driven by higher raw material costs and elevated fuel-related expenses.
• Production lead times extended as buyers advanced volume orders ahead of announced price increases, creating order backlogs and tightening near-term availability.

Building Materials

• Persistent logistical delays continue to be driven by transportation constraints.
• Fuel surcharges and broader cost inflation remain a factor across all product categories, with ongoing influence from geopolitical tensions in the Middle East.
• Together, these pressures are lengthening lead times and contributing to upward pricing pressure across most product lines.

Looking Through the Crystal Ball

Looking ahead through June, the lumber and building materials market is expected to remain mixed by product category, with dimensional lumber likely to hold stable to modestly firmer, plywood continuing to face some downward pressure, and OSB remaining broadly balanced. Dimensional lumber appears to have established a near-term floor, supported by steady replenishment buying, and a more balanced supply position than earlier in the season. While buyers are not expected to chase the market aggressively, consistent demand for immediate needs should help support current pricing and may allow for modest gains if mill order files strengthen.

Plywood is expected to remain softer as buyers continue to approach the market cautiously. With many customers purchasing hand-to-mouth and avoiding larger inventory positions, price discovery is likely to continue through June. Mills may attempt to hold close to posted levels where order files allow, but limited demand and competitive offerings through distribution and wholesale channels could create further modest price depreciation.

OSB, is expected to remain balanced, with pricing likely to stay relatively flat unless there is a meaningful shift in either supply availability or demand. Contract volumes continue to support much of the market, while cash-market activity remains limited and selective. Current lead times suggest material is moving, but not at a pace that would indicate strong upward pressure.

Across all categories, transportation constraints, fuel surcharges, and broader cost inflation remain important factors to monitor. These pressures continue to affect delivered costs, extend lead times, and contribute to upward pricing pressure across most product lines, particularly where supply chains are already tight. Geopolitical tensions and volatility in fuel markets may further influence freight costs as the month progresses.

Buyer behaviour is expected to remain cautious but active. Most customers are likely to continue purchasing based on immediate project requirements and replenishment needs rather than building significant forward inventory. Confidence in summer construction activity will be an important driver of demand. If project flow improves and buyers gain confidence that the market has reached a floor, purchasing activity could strengthen. However, if demand remains inconsistent, the market is likely to remain disciplined, with buyers continuing to manage inventory closely.

FRAMING LUMBER

OSB

PLYWOOD

MAY 2026 LUMBER MARKET REPORT HIGHLIGHTS:

Framing lumber demand improved late in the week, with trading accelerating sharply by Thursday after a slow start; Western S-P-F firmed modestly on tighter supply, while Eastern S-P-F saw stronger momentum and double-digit price gains on many items.

Market sentiment remained cautious due to macroeconomic uncertainty, including the war in Iran and Persian Gulf shipping disruptions, which continued to weigh on buyer confidence and broader market visibility.

Domestic logistics constraints were a major market driver, especially in southern pine, where severe trucking shortages and tightening railcar availability made FOB mill pricing harder to assess and pushed transportation costs higher.

MAY 29, 2026 PANEL MARKET REPORT HIGHLIGHTS:

Northern Demand remained mixed, with buyers showing limited urgency despite tighter open-market availability; rising resin and freight costs increasingly influenced purchasing decisions.

Regional Canadian pricing diverged: Western Canada prices edged up by $5/MSF USD, while Eastern Canada sales were sluggish and delivered flooring markets into Toronto and Montreal faced downward pressure.

Southern markets stayed quiet and flat, with prices unchanged; modest 7/16-inch volumes traded around $190-$200/MSF USD in the Southeast, but demand was too weak to support price increases.

*All Pricing is in CAD