25 Nov Freres Lumber November Market Update: Commodity Plywood Markets Consistently Mediocre with Slight Uptick in Business
November 25, 2019
The commodity plywood markets continue to be consistently mediocre, but that’s not all bad. Light to no inventory positions by most customers require them to be fill-in buying frequently. And due to a slight but welcome uptick in the level of business in the field in the past 60 days, customers seem to be a bit busier than they had anticipated. Every week, someone has something they need usually quickly. So, every week there is wood to buy and sell, which is at least positive.
However, prices have continued to languish, like they have for most of the year. Unfortunately, from the mill side very few commodity items are being sold that are profitable. This condition has persisted throughout much of this year.
In Canada it is a similar story to the U.S., with commodity plywood markets consistently mediocre. Fill in buying by cautious buyers is the name of the game. OSB markets came alive a few weeks ago, and prices were pushed up quickly in large chunks. So much so that after some initial covering, mots customers fell back on secondary or distribution offerings to supplement their yard inventories.
Like a broken record, the report on imported sheathing products is that they continue to be the spoiler in our domestic markets – diluting the markets with volume and cheap prices. It is very hard to overcome the current set of conditions in our marketplace. Customers continue to throw modest counters at domestic mills each week, adding insult to injury. There simply isn’t much more to give up right now, on the commodity side. We hope conditions will change into 2020, but the near term still looks to be challenging for plywood producers. But as always, things can change quickly and when you least expect it.
Bob Maeda, Plywood Sales Manager