Madison's Lumber Reporter

12/06/2023

Lumber Prices Rise on Ongoing Supply Constraints

It is normal that the US Thanksgiving holiday marks the end of true construction season across North America, thus also lumber sales, and this year was no exception. However, given the discipline of sawmills over the past year to reduce production volumes and curtail in an effort to keep supply in line with demand, lumber prices actually strengthened somewhat as November drew to a close.
Now that 2023 is coming to an end, industry folks are able to look back over the year and get a good view of what to expect for 2024. It is obvious from the graphs here that the extreme volatilty experienced over 2020 - 2022 is behind us; indeed this year price trends are looking extremely similar to 2019. Madison’s will be posting a direct comparison between that year and this, coming up soon. Stay tuned!

In the week ending November 24, 2023, the price of benchmark softwood lumber item Western Spruce-Pine-Fir 2x4 #2&Btr KD (RL) was US$414 mfbm. This is up by +$10, or +2%, compared to the previous week when it was $404, said weekly forest products industry price guide newsletter Madison’s Lumber Reporter. That week’s price is up by +$20, or +5%, from one month ago when it was $384.

FULL STORY: https://madisonsreport.com/lumber-prices-rise-on-ongoing-supply-constraints/

12/05/2023

The Madison’s Lumber Prices Index for the week ending December 1, 2023 is: US$447 mfbm
This is flat from the previous week when it was US$447.

For information regarding the construction of this Index (species mix, weighed averages) please go here: https://madisonsreport.com/madisons-lumber-prices-index-a-powerful-tool-for-data-driven-decision-making/

11/29/2023

Limited Supply Keeps Lumber Prices Higher

As the US Thanksgiving holiday approached, which usually marks the end of significant-volume lumber sales for the year, ongoing limited supply and hungry customers kept wood prices higher. After the severe volatility of the previous couple of years, the trendline for lumber prices through 2023 was quite stable indeed. This provides sawmills with the ability to make plans for the next coming building season, in spring of 2024.
As the series of unknowns and unprecedented events are behind us, this stability is quite welcome, by lumber sellers and buyers alike. Expectations for next year are a return to “normal”, and none too soon.

In the week ending November 17, 2023, the price of Western Spruce-Pine-Fir 2x4 #2&Btr KD (RL) was US$404 mfbm, which is flat from the previous week, said weekly forest products industry price guide newsletter Madison’s Lumber Reporter.
That week’s price is up by +$20, or +5%, from one month ago when it was $384.

FULL STORY: https://madisonsreport.com/limited-supply-keeps-lumber-prices-higher/

11/28/2023

The Madison’s Lumber Prices Index for the week ending November 24, 2023 is: US$447 mfbm

This is up by +2.5%, or +$11, from the previous week when it was US$436.

For information regarding the construction of this Index (species mix, weighed averages) please go here: https://madisonsreport.com/madisons-lumber-prices-index-a-powerful-tool-for-data-driven-decision-making/

11/22/2023

Increased Demand Pops Up Lumber Prices

At a time of year when construction activity, thus lumber sales, are usually slowing down which generally means lumber prices drop; this year the ongoing severe supply constraints worked to pop lumber prices higher. Customers continued to stick to the practice of just-in-time buying, since approximately the middle of last year, so have got caught short of the wood they need to finish projects before true winter weather comes on across North America.
Sawmill order files stretched out into December, when normally at this time of year they are barely a few days, or even prompt. As producers eye year end, when they empty their lumber yards to avoid the tax implications of carrying wood through to the next year, buyers will be feeling an ongoing squeeze of supply.

In the week ending November 10, 2023, the price of benchmark softwood lumber item Western Spruce-Pine-Fir 2x4 #2&Btr KD (RL) was US$404 mfbm. This is up by +$24, or +6%, compared to the previous week when it was $380, said weekly forest products industry price guide newsletter Madison’s Lumber Reporter. That week’s price is up by +$20, or +5%, from one month ago when it was $384.

FULL STORY: https://madisonsreport.com/increased-demand-pops-up-lumber-prices/

11/21/2023

The Madison’s Lumber Prices Index for the week ending November 17, 2023 is: US$436 mfbm

This is up by +2%, or +$9, from the previous week when it was US$427.

For information regarding the construction of this Index (species mix, weighed averages) please go here: https://madisonsreport.com/madisons-lumber-prices-index-a-powerful-tool-for-data-driven-decision-making/

11/16/2023

Year-End 2023 North America Softwood Lumber Market Update

October 24, 2023 – Vancouver, BC, Canada

After a minor boost in recent weeks, toward the end of October North American softwood lumber prices began their usual annual seasonal drop. Customers, whether retailers or end-users, continued to make purchases for immediate needs only, keeping their inventories quite lean indeed.
For their part, sawmills kept production volumes tight to stay in line with weakening demand as this winter season truly comes on. After the volatility of the previous two years, these more normal price fluctuations were welcome by industry players.

Now that the previously unimaginable price highs are relegated to history, builders and lumber producers are better able to gauge what might come in 2024.

This story originally appears in the latest print issue of Canadian Forest Industries magazine, here: https://mydigitalpublication.com/publication/?m=853&i=808134&p=24&ver=html5

CANADIAN WOODPRODUCTS 2023 YEAR-END UPDATE BY KETA KOSMAN Toward the end of October, North American softwood lumber prices began their usual annual seasonal drop. Customers, whether retailers or end users, continued to make purchases for immediate needs only, keeping inventories quite lean. Sawmills...

11/16/2023

Lumber Prices Rise on Supply Constraints

The ongoing strategy of North American sawmills reducing production and curtailing manufacturing volumes succeeded in reversing the usual seasonal drop of lumber prices. As November dawned, the supply-demand balance was such that lumber sellers were able to actually increase prices somewhat. Customers have been running on lean inventories for most of this year, as macroeconomic uncertainty made for quite cautious business decisions.
Most lumber buyers have been making purchases for immediate needs only, not keeping any additional inventory on hand, in the thought that lumber prices might drop further. At the same time, lumber producers have been keeping production volumes low so as to not oversupply the market and thus drive prices lower. These circumstances collided at the beginning of November, bringing prices up higher as customers needed to keep ordering wood for ongoing building projects.

In the week ending November 3, 2023, the price of Western Spruce-Pine-Fir 2x4 #2&Btr KD (RL) was US$380 mfbm, which is flat from the previous week, said weekly forest products industry price guide newsletter Madison’s Lumber Reporter.
That week’s price is down by -$4, or -1%, from one month ago when it was $384.

FULL STORY: https://madisonsreport.com/lumber-prices-rise-on-supply-constraints/

11/14/2023

The Madison’s Lumber Prices Index for the week ending November 10, 2023 is: US$427 mfbm

This is up by +5%, or +$21, from the previous week when it was US$406.

For information regarding the construction of this Index (species mix, weighed averages) please go here: https://madisonsreport.com/madisons-lumber-prices-index-a-powerful-tool-for-data-driven-decision-making/

11/09/2023

Late-Season Pop in Sales Boosts Lumber Prices

As home building and construction activity across North America slows down into winter, and demand for solid wood materials also slows, lumber prices usually start to drop. Sometimes, if there is a boost in building, there might be a late-season pop in lumber prices. That happened this year at the end of October.
This is likely due more to end-users having kept their inventory levels very low for most of the past year, than to any true increase in construction. Those customers who are now finishing their projects but got caught short of the wood they need to complete, had to go back to suppliers to make more purchases. As such, sellers were able to increase prices slightly to account for this rush of demand.

In the week ending October 27, 2023, the price of Western Spruce-Pine-Fir 2x4 #2&Btr KD (RL) was US$380 mfbm, which is up by +$6, or +2%, from the previous week when it was $374, said weekly forest products industry price guide newsletter Madison’s Lumber Reporter.
That week’s price is down by -$33, or -8%, from one month ago when it was $413.

FULL STORY: https://madisonsreport.com/late-season-pop-in-sales-boosts-lumber-prices/

11/07/2023

The Madison’s Lumber Prices Index for the week ending November 3, 2023 is: US$406 mfbm
This is up by +1%, or +$4, from the previous week when it was US$402.

11/02/2023

Lumber Prices Flatten as Construction Season Closes

After a minor boost in recent weeks, North American construction framing dimension softwood lumber prices once again began their usual annual seasonal drop. Customers, whether retailers or end-users, continued to make purchases for immediate needs only, keeping their inventories quite lean indeed.
For their part, sawmills kept production volumes tight to stay in line with weakening demand as the winter season truly comes on. After the volatility of the previous two years, the more normal price fluctuations of this year were welcome by industry players. Now that the previously unimaginable price highs are relegated to history, lumber manufacturers and builders are able to look at this year’s price changes to better gauge what might come in 2024.

The price high for Western S-P-F 2x4s this year was US$476 mfbm in the week of February 9, then was US$458 for most of July, while the low was at the beginning of January at US$370, which is very close to the current price.
This more usual price swing of approximately $100 throughout the year is much closer to what sellers and customers have been accustomed to in the past. This means they are better able to make their business plans for the near future, specifically spring building season 2024.
Sawmills reported strong counter offers requiring review on a case-by-case basis, with order files stuck at less than two weeks in most cases.

In the week ending October 20, 2023, the price of benchmark softwood lumber item Western Spruce-Pine-Fir 2x4 #2&Btr KD (RL) was US$374 mfbm. This is down by -$8, or -2%, compared to the previous week when it was $382, said weekly forest products industry price guide newsletter Madison’s Lumber Reporter.
That week’s price is down by -$39, or -9%, from one month ago when it was $413.

FULL STORY: https://madisonsreport.com/lumber-prices-flatten-as-construction-season-closes/

11/01/2023

The Madison’s Lumber Prices Index for the week ending October 27, 2023 is: US$402 mfbm
This is flat from the previous week when it was US$402.

For information regarding the construction of this Index (species mix, weighed averages) please go here: https://madisonsreport.com/madisons-lumber-prices-index-a-powerful-tool-for-data-driven-decision-making/

10/27/2023

US Housing Market September & Softwood Lumber Prices October: 2023

US homebuilding bounced back in September 2023, after dropping in August to the lowest levels since 2020 as mortgage rates climbed. Despite elevated mortgage rates averaging above 7%, single-family starts posted a gain in September, according to the National Association of Home Builders, which says more buyers are turning to new homes because of a dearth of inventory in the resale market.
NAHB Chief Economist Robert Dietz said, “Despite ongoing challenges in the market, the housing deficit of resale inventory continues to provide some market support for builders. Because of a lack of existing homes in the marketplace, 31% of homes available for sale in August were new construction. This compares with a historical average in the 12-14% range.”

The number of apartments under construction is near 1 million units and will be falling in the months ahead, predicts the NAHB.

The interest rate increases of mid-2022 having served their purpose, September 2023 total housing starts in the US rebounded from consistent drops over the past year, up by +7% from the previous month, to 1.358 million units, compared to the 1.269 million units reported for August 2023, and were down -12% from the September 2022 rate of 1.463 million units.

FULL STORY: https://madisonsreport.com/us-housing-market-september-softwood-lumber-prices-october-2023/

09/28/2023

US Housing Market August & Softwood Lumber Prices September: 2023

After spiking to unsustainable highs during the disruptions to society in the past couple of years, US housing starts trended further downward in August 2023. Permits for authorizations of new home building increased, however. Demand for new construction has been boosted by an ongoing acute shortage of previously owned homes on the market.
Realtors estimate that housing starts and completion rates need to be in a range of 1.5 million to 1.6 million units per month to bridge this inventory gap. Expectations among construction industry insiders and financial lenders alike is that single-family construction starts could rebound in the coming months, if builders are able to keep their skilled labour.

Coming off real highs in the previous two years, August total housing starts in the US fell by -11% from the previous month, to 1.283 million units, compared to the 1.447 million units reported for July 2023, and were down -15% from the August 2022 rate of 1.505 million units.

FULL STORY: https://madisonsreport.com/us-housing-market-august-softwood-lumber-prices-september-2023/

09/27/2023

Lumber Sales Drop as Autumn Comes On

As true autumn weather came on across the continent, construction activity started to slow down. As such, lumber sales also slowed somewhat. While there were pockets of ongoing building in several regions, elsewhere the usual seasonal slowdown had started. Given the quite stable lumber price levels through this year so far, expectations are for a more predictable and understandable market to come in 2024. This will be very welcome by the forest products industry and builders alike, as the extreme volatility of the past couple of years made it difficult to plan for business decisions. Production volumes, especially in Canada, are still lower than optimal; so sawmills actually have quite a bit of volume available to come online when demand does indeed pick up.

In the week ending September 15, 2023, the price of Western Spruce-Pine-Fir 2x4 #2&Btr KD (RL) was US$410 mfbm, which is down by -$16, or -4%, from the previous week when it was $426, said weekly forest products industry price guide newsletter Madison’s Lumber Reporter.
That week’s price is down by -$7, or -2%, from one month ago when it was $417.

FULL STORY: https://madisonsreport.com/lumber-sales-drop-as-autumn-comes-on/

09/26/2023

Just putting together usual monthly US starts and Madison's Prices Index, noticed something interesting:

Graph
Graph with 2021 & 2022 removed

In-depth look at what these trendlines mean to come.

09/26/2023

The Madison’s Lumber Prices Index for the week ending September 22, 2023 is: US$448 mfbm
This is down by -1%, or -$4, from the previous week when it was US$452.

For information regarding the construction of this Index (species mix, weighed averages) please go here: https://madisonsreport.com/madisons-lumber-prices-index-a-powerful-tool-for-data-driven-decision-making/

09/20/2023

Continued Weak Field Inventories Buoy Lumber Prices

This has historically been a time for lumber prices to start dropping as the season changes to autumn. Generally speaking, construction activity starts to slow down after Labour Day. For the past year of rising interest rates and some unknowns for the housing market, lumber buyers have kept their inventories lean due to uncertainty of consistent demand. With industry folks this is known as just-in-time buying. The strategy can fail if there is a sudden increase in lumber sales but not enough inventory in the field to serve that rise in demand.
At the moment, the sawmills have been running at less-than-optimal capacity utilization rates, so customers have felt confident they would not get caught short without the wood they need for ongoing projects. If demand increased suddenly, lumber manufacturers could simply increase production to sell higher volumes while keeping the price relatively even. In this wait-and-see environment, some lumber prices have popped up slightly.

In the week ending September 8, 2023, the price of benchmark softwood lumber item Western Spruce-Pine-Fir 2x4 #2&Btr KD (RL) was US$426 mfbm. This is up by +$6, or +1%, compared to the previous week when it was $420, said weekly forest products industry price guide newsletter Madison’s Lumber Reporter.
That week’s price is up by +$9, or +2%, from one month ago when it was $417.

FULL STORY: https://madisonsreport.com/continued-weak-field-inventories-buoy-lumber-prices/

09/19/2023

The Madison’s Lumber Prices Index for the week ending September 15, 2023 is: US$452 mfbm
This is down by -2.4%, or -$11, from the previous week when it was US$463.

For information regarding the construction of this Index (species mix, weighed averages) please go here: https://madisonsreport.com/madisons-lumber-prices-index-a-powerful-tool-for-data-driven-decision-making/

09/13/2023

Pre-Labour Day Lumber Sales Remain Strong

Ahead of the Labour Day long weekend, which traditionally marks a beginning of slow-down to construction activity thus lumber sales, customers caught short of inventory needed for existing projects found some prices were on the rise.
Sawmills were — at least — able to resist counter-offers, if not actually able to push prices up on some items. Demand at secondary suppliers was hot; those with the necessary wood on hand sold reasonable volumes at higher prices.
This year the seasonal changes were abrupt, to say the least. Regions across North America went from harsh winter to epic wildfires in seemingly one day.
The same can be said for this looming autumn; both Canada and the US are going from drought-like conditions to wild storms … with no transition in between. What this means for the rest of the year’s lumber sales remains to be seen.

In the week ending September 1, 2023, the price of Western Spruce-Pine-Fir 2x4 #2&Btr KD (RL) was US$420 mfbm, which is flat from the previous week, said weekly forest products industry price guide newsletter Madison’s Lumber Reporter. That week’s price is up by +$3, or +1%, from one month ago when it was $417.

FULL STORY: https://madisonsreport.com/pre-labour-day-lumber-sales-remain-strong/

09/12/2023

The Madison’s Lumber Prices Index for the week ending September 8, 2023 is: US$463 mfbm
This is up by +0.4%, or +$2, from the previous week when it was US$461.

09/06/2023

Late-Season Demand Pushes Lumber Prices Up

A burst of increased demand in the last two weeks of August pushed up many lumber prices somewhat. The practice of customers to stick to just-in-time buying, held for the better part of the past year, created a situation of low field inventories. As construction activity continued across the continent, customers found themselves purchasing more wood for immediate needs.

This increased demand pushed sawmill order files well into September, providing suppliers the ability to reject counter-offers and raise prices on some items. The historical seasonal trend has been for home building to slow down in September, thus lowered lumber sales volumes and falling prices. The past three years have not followed the previously normal seasonal cycle, so many questions remain about how the lumber market will look this autumn.

In the week ending August 25, 2023, the price of benchmark softwood lumber item Western Spruce-Pine-Fir 2x4 #2&Btr KD (RL) was US$420 mfbm. This is up by +$10, or +2%, compared to the previous week when it was $410, said weekly forest products industry price guide newsletter Madison’s Lumber Reporter.
That week’s price is down by -$35, or -8%, from one month ago when it was $455.

FULL STORY: https://madisonsreport.com/late-season-demand-pushes-lumber-prices-up/

09/05/2023

The Madison’s Lumber Prices Index for the week ending September 1, 2023 is: US$461 mfbm

This is up by +0.2%, or +$1, from the previous week when it was US$460.