Lumber futures plunge by US$10 daily limit in all contracts except September on July 31 on month-end technical selling, Canadian mills' urgency to beat Aug. 1 renewal of US export duties; September tumbles US$9.60 to US$310.50/mbf
August 1, 2013
– Lumber futures plunged by the $10 daily limit in all contracts but September on July 31, according to a commentary by Dow Jones. The month-end action resulted in an average decline of 3% on the day in futures prices, with most contracts hitting two-week lows during the Chicago Mercantile Exchange trading session.
Technical selling and continued urgency to sell by some Canadian mills before the renewal of export duties to the U.S. on August 1 contributed to the declines.
According to one broker, rolling of positions as July came to an end combined with a rush by Canadian mills to close immediate sales before the duties on U.S. shipments were reintroduced on Thursday, with lumber from British Columbia and Alberta moving to 10% from zero. The broker noted that mills were offering wood at lower prices, but buyers were showing little interest.
September dropped $9.60 to $310.50 per thousand board ft. (mbf) and November was down $10 to $315.10/mbf. Cash prices were reported in a $320-$325/mbf range.
The primary source of this article is Dow Jones, Chicago, on July 31, 2013.