North American construction framing dimension softwood lumber prices shot up spectacularly last week as lean field inventories forced customers to come to the table for large-volume buys.
Immediately at the beginning of January, wholesaler prices of benchmark lumber commodity Western Spruce-Pine-Fir KD 2×4 #2&Btr started rising off full-year 2018 lows, finishing last week at US$404 mfbm, a $58 or +14.4% increase from $346 the week before. At close Monday, lumber futures on the Chicago Mercantile Exchange were US$423, a historically-appropriate $25 premium to cash prices.
Canadian and U.S. softwood lumber prices strengthened considerably as end-users found themselves low on inventory for a wide range of products. Sawmills booked production out to four weeks or longer, while secondary suppliers worked to both replenish inventories from last week’s buys and book more sales going forward.
This week’s Southern Yellow Pine East Side 2×4 #2&Btr KD, the other large volume-traded softwood lumber commodity, composite price was US$389 mfbm, a +0.8% decrease from the previous week’s price of $392, and a -13.6% decrease from the same week in 2018. Year-To-Date average price from Forest2Market’s Southern Yellow Pine index is US$382 mfbm.