May Market Update: Western Plywood Markets Stall

May 30, 2017

Western Plywood Markets Good, But Stalled

Freres Lumber Company, and all suppliers, are experiencing a slow climb upward in the markets. The western plywood markets have been lethargic, for the most part, over the past thirty days. During the week before Memorial Day weekend the markets finally gained some traction on Thursday, mostly on rail, to eastern seaboard customers. That hasn’t happened in a long time due to heavy discounting at the eastern distribution level. It is encouraging to see that some customers have the need to do some replenishing of inventory.

Western Plywood Markets

 

Our truck markets have been steady, if not spectacular. Still, it is a bit early to get too negative about the current lull in the commodity markets. Business is good in the field and product shipments should improve into June, making way for steady replacement by customers. Lumber markets have been in a relative lull as well, but again, demand is good in most areas and wood will continue to get bought every day. How that translates to pricing remains to be seen.

Western Panel Markets

 

International Markets Continue to Affect the Domestic Panel Pricing

Panel imports from Canada, South America, and Europe continue to dilute our domestic panel markets and depress our prices. In fact, most imported sheathing comes with huge discounts, something that, unfortunately, further erodes confidence in our domestic marketplace. We have to live with that for now, but it’s a larger, long term problem for domestic producers like Freres Lumber. The strong dollar remains the largest single factor in depressing our markets in this country. It’s hard to compete with heavily discounted imports and conversely, hard to move product out of the country as well. A double whammy, and something that has to be addressed by our country’s leaders, because it’s hurting the industry in a big way.

Western Plywood Markets

 

Summer Predictions Look Good for Western Plywood Markets

Domestic business, again, looks good for the summer. The question is – how does this translate into pricing for lumber and panel products – and how much does our supply outstrip good demand? Inventories will remain low, a fact that has been and will be the common for most commodity buyers and people will stay in a perpetual scramble mode in their buying habits. That is just how it is nowadays. We try our best to fully utilize our truck resources and strong service level to get our share of the available business each day.

Bob Maeda

Bob Maeda, Plywood Sales



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