Random Lengths framing lumber composite drops US$8 to US$370/mbf in week ending April 4; green Douglas fir Std&Btr 2x4 falls in double digits for fourth straight week at Portland-rate mills and is US$65 below year's peak price in late January

LOS ANGELES , April 6, 2014 () – The Random Lengths framing lumber composite fell US$8 (2.12%) to $370 per thousand board ft. (mbf) in the week ending April 4, and was $81 (17.96%) below the price reported at this time last year of $451/mbf, Random Lengths reported in its weekly lumber market report.

Framing lumber markets continued to weaken, and talk circulated that the market was oversupplied. Green Douglas fir and Western SPF prices were particularly soft, falling by double digits, and mills generally struggled to get the cars they needed to move inventory build-ups, reported Random Lengths.

Western SPF mills had accumulated heavy build-ups of sold and unsold lumber, and prices fell early in the week. Prices of #2&Btr 2x4 were reported in the mid-340s, #3 2x4 to around $330 and #2&Btr 2x10 to around $370-375, reported Random Lengths. The price drops helped to attract some buyers, but as futures prices dropped from Wednesday, sales fell back. By Thursday, most mills were holding to quoted levels but were prepared to listen to counters.

Futures for delivery in May, July and September were on a downward trend from April 2, when May ended down $6.40 on the day at $334.60/mbf and July dropped by the $10 daily limit to $338.10/mbf. Further steep drops on Thursday and declines in smaller increments of up to $4 on Friday canceled out gains of up to $8.80 earlier in the week. May futures, which opened on Monday, March 31, at $334.30/mbf, closed $5.90 (1.76%) down on the week at $328.40/mbf. July closed the week at $324.80/mbf – down $12.50 (3.71%) from an opening price on Monday of $337.30/mbf.

The reported price of KD Western SPF #2&Btr 2x4 dropped $10 (2.82%) to $344/mbf from $354/mbf, and was $60 (14.85%) below the price reported at this time last year of $404/mbf.

Eastern SPF prices were mixed in uneven trading in both the U.S. and Canada, reported Random Lengths. Tuesday was the best day for sales, and activity fell back over the rest of the week. Some producers edged prices higher, while others opened to modest counters, and this led to quotes in a wide range.

The reported price of KD Eastern SPF (delivered Great Lakes) #2&Btr 2x4 random held at $445/mbf for a second week, and was $58 (11.53%) below the year-ago level of $503/mbf.
Southern pine buyers limited purchases to fill-in volumes as uncertainty prevailed about near-term demand, reported Random Lengths. Most producers were prepared to negotiate on price, often opening to sharp discounts to give buyers some downside protection. #2 2x10 showed the most strength, while the deepest cuts were seen in #2 2x6.

The reported price of KD Southern Pine (Westside) #2 2x4 dropped $11 (2.69%) to $387/mbf, and was $93 (19.38%) lower than the price a year ago of $480/mbf.

Prices of Douglas fir Std/#2&Btr dimension continued to fall sharply, with the deepest cuts seen in the wides. The reported price of Portland rate Std&Btr 2x4 dropped in double digits for the fourth consecutive week, falling $15 (4.29%) to $335/mbf, and down $55 (14.10%) from a year ago. Random Lengths noted that the reported price on April 4 was $65 lower than the highest price of the year, reached in late January. #2&Btr 2x6 also fell by double digits at Portland-rate mills – to $330/mbf – while drops of up to $20 were reported in 2x10 and 2x12.

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