November 2016 Lumber and Commodity Report

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The Ro-Mac Lumber & Supply, Inc. Wood Commodity Index (Index) decreased 4.1 percent, as the wood commodity markets tried to sort out demand, seasonal changes, and the new political direction in America.  Uncertainty at the beginning of winter does not bode well for pricing in the wood commodity markets.  So most should not expect a run in pricing. 

The dimensional portion of the Index dropped 4.2 percent or about $15 per thousand.  Spruce studs were off about 3.5 percent, with dimensional giving back on average 7.0 percent.  Wide width pine took the biggest hit by dropping 6.1 to 8.8 percent depending on length.  Narrow width pine treated was the only item in the Index to print up. 

The sheathing side of the Index was consistent, with OSB sheathing handing back $10 per thousand over the last 30 days while CDX Pine Plywood decreased $20-$30 per thousand.  CDX T&G added 3.9% or about $20 per thousand to offset declines from other sizes. There is no doubt about it, the direction of sheathings was down.

Unless enthusiasm can take the place of uncertainty, it is safe to say that wood commodities will probably be flat to down over the new few weeks between the holidays.  Many suppliers will probably lower inventory levels to build cash and this will make the markets more vulnerable to volatile markets.  If the economy and enthusiasm take hold after the first of the year, today’s bids could be too low.  Builders should be wary of holding today’s prices for next spring’s work. 

Don Magruder is the Chief Executive Officer of Ro-Mac Lumber & Supply, Inc. in Central Florida (www.romaclumber.com), and he is a former President of the Southeast Mississippi Home Builders Association, and past Associate Vice President of the Home Builders Association of Lake County. To contact Magruder, email him at This email address is being protected from spambots. You need JavaScript enabled to view it. .

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