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Stability restored to US softwood lumber prices

09.11.2015 − 

After the reductions of 7-20% that had occurred in softwood lumber prices on the US market from mid-July to mid-September depending on the assortment, the development in prices has turned around again in the last few weeks. The figures from Random Lengths show that the average price for the benchmark grade of western SPF 2x4 #2&Btr KD has risen by around $32/1000 bdft since the beginning of October. The Framing Lumber Composite Price (FLCP) has risen by $29 in the same period. Irrespective of the latest increases, the two figures remain roughly 20% and 12% short of the reference figures for last year. Prices for 1x6 European spruce had fallen much less sharply by the end of the third quarter. The average FOB Gulf & East Coast price at the end of June was $286/m³ and had only fallen by 3% to $278/m³ by the beginning of October, which is only 3%lower, too, than the figure for the same month of last year.

From what US and Canadian manufacturers say, a surplus supply of most of the softwood lumber assortments was responsible for the price decay that occurred on the US market during the course of the third quarter. A reduction in building activity in China and Russian shippers’ greater involvement in this market has resulted in considerably more intense competition there, decay in prices, and therefore in reduced lumber deliveries from North America to China as well.

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