Random Lengths framing lumber composite advances for third consecutive week by US$6 to US$376/mbf; pick-up in Canadian demand leads to midweek surge in Eastern SPF sales

LOS ANGELES , May 11, 2014 () – The Random Lengths framing lumber composite gained for the third straight week in the week ending May 9, climbing US$6 (1.62%) to US$376 per thousand board ft. (mbf).

Producers raised quotes in small increments, supported by steady demand across most regions and a pick-up in the Canadian market, reported Random Lengths in its weekly lumber market report.

Compared to the price at this time last year of $383/mbf, the composite was $7 (1.83%) lower.

Western SPF sales were steady and prices increased modestly as the U.S. market gained strength, and activity from Canadian buyers increased. Many producers extended order files into late May and early June, although Random Lengths noted that railcar availability in British Columbia often played a part in the extended shipment times.

Prices of KD Western SPF #2&Btr 2x4 moved to the mid to high $340s, and the reported price lifted $4 (1.17%) to $346/mbf -$8 (2.37%) above the price reported at this time last year of $338/mbf. 2x6 settled in a $330-335 range.

Lumber futures prices were generally flat-to-down for most of the week, but small gains of up to $2 on Thursday and Friday helped to offset the losses. May lumber futures, which opened on Monday, May 5, at $343.10/mbf, closed on May 9 at $338.50/mbf, a drop on the week of $4.60 (1.34%), while July futures, which opened the week at $341.00/mbf, closed $2.00 (0.59%) higher on Friday at $343.00/mbf.

The increased participation of Canadian buyers led to a midweek surge in Eastern SPF sales, and prices finished higher despite earlier weakness, reported Random Lengths. Order files extended into late May or early June, although truck and car availability remained a factor in shipment times.

The reported price of KD Eastern SPF (delivered Great Lakes) #2&Btr 2x4 random advanced $3 (0.69%) to $436/mbf, and was $9 (2.02%) below the price reported at this time last year of $445/mbf.

In Southern pine markets, purchasing was generally conservative, reported Random Lengths, but sales were sufficiently active to allow producers to firm prices, especially from Thursday when some mills reported a pick-up in sales.

The reported price of KD Southern Pine (Westside) #2 2x4 moved $4 (1.04%) higher to $389/mbf – down $21 (5.12%) from the price reported at this time last year of $410/mbf. Random Lengths noted that sales were brisk in the eastside and central zones, while trading on the westside was at previously established levels.

The sales momentum in Douglas fir markets seen in the week ending May 2 failed to carry over into last week, and prices finished level with, or slightly higher, than the previous week’s levels, reported Random Lengths. There was a moderate improvement in demand from the Northeast, but sales to customers in Southern California fell back.

The reported price of green Douglas fir Std&Btr 2x4 finished the week at $330/mbf, a gain of $3 (0.92%) from the week before, but $7 (2.08%) below the price reported at this time last year of $337/mbf.

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