SPF prices in North America continued to fall this week, falling more than last week.
As the number of orders accumulated in the early stage of the Canadian sawn timber factories gradually depleted, the sales staff had to start selling more sizes at lower prices. Among them, in particular, the construction market is the most used in the second level 38X89 and 38X140 fell the most, the decline was close to 10 US dollars per cubic meter, the decline of the third grade was small, the economic grade due to the impact of the Canadian exchange rate, 38X89 fell 6 US dollars, and other wide boards fell 2 US dollars. There are two reasons for this week's decline, the first is that the market remains weak, with factories selling less than they are producing. On the other hand, the annual Montreal Timber Conference kicked off this week, adding to already thin trading volumes as traders from across North America left their companies for public relations. If the decline is not stopped quickly next week, this round of decline may last for a long time.
Note 1: The above prices are large factories, and each actual transaction will be subject to price differences due to many factors such as product quality, inventory, length ratio, and logistics distance to the port.
Note 2: The above prices #2&BTR and #3 include US countervailing duties and anti-dumping duties, but the economic grade prices do not include these two US tax burdens.
This week, the price trend of European lumber in the eastern states of the United States is basically similar to that of the Canadian SPF, but the decline in 38X89 was even greater, reaching $16 per cubic meter, almost double the decline in SPF, while the inventory of wide plates was relatively small and the decline was relatively modest. However, the recent docking of any bulk carrier could quickly change the situation, triggering a sharp drop in the size of some species.
The 30-year mortgage rate in the United States continued to climb to 6.88% this week from 6.82% last week, while inflation indicators re-emerged and economists began to speculate that the Fed will not cut rates this year, and that there may even be a rate hike. This is one of the reasons why timber prices fell this week.
As mentioned in this column last week, the timber futures market on the Chicago Mercantile Exchange in the United States seems to have lost confidence in the coming weeks, and this week's May standard futures contract further confirms this forecast. Futures prices started at $571 per 1,000 board feet at the end of last week, staggered down day by step, fell below $540 on Friday, bottomed out at $536 and then struggled to recover, and finally closed at $541, down $30 for a week. This state of slump is likely to continue into next week.