Lumber prices continue to rise: Fifth weekly gain despite southern pine lag

Sales picked up in many framing lumber species, especially in the West. A lack of supplies in Canadian S-P-F led to buyers switching to other species. As a result, in the middle of the week markets like the Inland and Coast saw more demand and price gains than have been evident for several weeks.

The Random Lengths Framing Lumber Composite Price notched its fifth consecutive weekly gain and hit $430, its high so far this year.

A mild increase in demand for Western S-P-F collided with the realization from buyers that lumber supplies were significantly constrained in spots. Mills sold their few prompt offerings and raised quotes for extended shipments. Most order files extended into mid-November. Rising mortgage rates and next week’s U.S. election were distractions but had little impact on the market.

Gains in the cash market were supported by strong upward movement in lumber futures through Wednesday. The November and January contracts traded in the green much of the week, with double-digit gains posted across all contracts on Wednesday.

Despite an overall rising market, Southern Pine was a laggard. Supply-driven strength that fueled the recent run in the South faded or stalled as mill order files dwindled and prompt loads surfaced more frequently. Demand weakened as a growing number of buyers throughout the distribution pipeline moved to the sidelines.

Some mills continued to capture premiums, noting that middle widths in particular were competitively priced compared to Western S-P-F. Buyers confined new orders to loads that could ship within one week.

The Coast market rolled into Halloween on a positive note as tightness in green Fir and S-P-F resulted in buyers subbing in dry Fir. “We’re driving the bus right now,” said one mill salesman.

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