June 3, 2020

Lumber markets finally took a breather, and prices showed some signs of peaking after the frantic run-up we have seen in the last month.  The rail car shortages that were contributing to the run-up seemed to subside, and we are now seeing shorter lead times for shipment on rail cars.  Truck availability was another story in the southwest, however, with produce growers competing with sawmills for the limited number of trucks that were available.  After climbing by nearly $30 in the last 3 weeks, prices for 2×4 #2&Btr SPF leveled off, and mills finally started showing some offers.  Higher quality 2×4 #2&Btr Inland White Fir prices moved up another $10 or so last week, and have climbed by more than $40 over the last three weeks.  2×4 MSR SPF offerings were still limited, and prices moved up another $20 last week.  So far, the mills have rejected any low counter-offers, and distributors have been forced to pay the higher prices.  Stud markets did something of a flip-flop, with 2×8-8’ trims becoming scarce, while 2×4-9’ offerings were abundant.  Some wholesalers were aggressively trying to move their 2×4-9’ positions, creating a 2-tiered market where they were actually priced UNDER the mills.  Wide dimension prices were strong again, and prices climbed another $10 per mbf.  Low grade prices were flat, but we noticed that 2×4 economy was pretty scarce, unlike mill run rough lumber and 2×6 economy.

Panel markets remained strong, and prices finished the week higher, but sales seemed to be slowing.  4×8 7/16” OSB was still hard to find, and most mills were focused on fulfilling contracts at the new higher numbers.  We are starting to sense that the market might be getting a bit top-heavy, however, because were have seen more offerings for 4×9 and 4×10 7/16” OSB, and the prices have remained flat.  Plywood prices are following a similar pattern to OSB prices.  While mill prices were higher yet again, sales started to tail off, and by Monday, the mills were somewhat quieter.

Steel markets continued to languish, and prices were flat or slightly lower.  Domestic rebar producers have been lowering their prices to stay competitive against the importers.  Lead times at the mills for #3, #4 and #5 rebar have been short, giving buyers the upper hand in negotiating prices.  Remesh prices have also come under pressure, as domestic mills try to stay ahead of the foreign producers.