July 2024
Trading remained measured throughout most of June. Buyers were cautious with their purchases, careful to find the right fit and price for their needs and some electing to burn thru existing inventories as to manage mold concerns in many regions that have seen unseasonable amounts of moisture.
Pallet demand remains steady for most of our customers, with most reporting being at 80-100% of capacity. Surprisingly, we had our busiest day of the month July 3rd. It seems that some customers felt the bottom was in, and prices were attractive enough that they were electing to lock in big volumes as to be able to lock in profit and pricing for the next few months. SPF Econ and #3 are at multi year lows, so this tends to make sense.
W-SPF demand is best in California and Mexico, and parts of the Midwest. 2x4 has fallen the hardest, off almost $70/mbf month over month. 2x6 Econ 10’ and 14’ is still tight and trading in a range $290-320. Opportunity exists more in 2x6x8’ as it is trading at almost a $70 discount to 10’ and 14’. Wides are still extremely tight, and trading at a $50 premium to 2x4, which I have never seen.
We have been able to take advantage of the lowest freight rates we have seen in a decade, and have been passing along those savings to customers. DF/HF continues to trade at a premium to SPF in most markets and as a result has increased SPF demand. 2x4 #3 SPF is piling up at mills and continues to be the main force drawing down 2x4 Econ prices. Cut stock is having a harder time finding a trading level, as many are electing to cut their own stock, if they are able. Labour is less of an issue as it has been in previous months.
We are taking the position of a flat to slightly up market thru the rest of the summer, and taking advantage of block buy opportunities, when the prices are too good to pass up. We’ll see how the rest of the summer pans out.
Industrial Lumber Update - July 2024
Contributed by Eric Ander, PNW Lumber
Cont'd on Page 18