Lumber headed back to historic trends after recet volatility

Keta Kosman
0 Comments|January 31, 2014

Prices of North American lumber and panel products remained essentially flat this week over last, as producers and customers have settled on agreeable floor levels and are down to the business of trading wood, , writes Keta Kosman in Madison's Lumber Reporter
Suggestions that transportation issues due to more extreme bad weather in the eastern US have put a damper on early-season buying were heard but not much heeded.
Sales volumes remained encouraging for the time of year. Some specific sizes, such as nine-foot studs of any species or 2x6 dimension lumber in some regions, experienced a minor bounce. Sawmills reported order files on these more prized items into the second week of February.
Also encouraging is the fact that prices of the most commonly-traded solid wood products in North America are relatively stable compared to this time last year. It seems the remarkable volatilty of 2012 and 2013 is past, and going forward prices could behave in a similar way to long-term historic trends.
In western R/L lumber, #3/Utility grade 2x4s swas the only commodity to move up in price. WSPF KD 2x4 #3 popped $12, or 3.5 per cent, from last week to US$342 mfbm net FOB mill.

The United Steelworkers announced Thursday a tentative agreement in five BC interior West Fraser Timber Co. Ltd. (TSX: T.WFT, Stock Forum) operations at Fraser Lake Sawmill, Houston Forest Products, 100 Mile House Lumber, Williams Lake Plywood, and Quesnel Plywood.

Based on the pattern developed first with Canfor Corp. (TSX: T.CFP, Stock Forum)and then refined later with the IFLRA, the West Fraser deal mirrors the gains made earlier and addresses USW members’ West Fraser specific issues and concerns, the union press release said.

In company news, Canfor announced January 27 it is continuing its commitment to upgrading the Elko sawmill with a capital investment of $10 million.

The funds will go towards the installation of a wood biomass-fired energy system to improve efficiency at the mill. Canfor currently operates three sawmills throughout the Kootenays and the Elko mill is a significant contributor to the regional economy.
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Keta Kosman
Madison's Lumber Reporter
604 984-6838

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