Southern Yellow Pine Composite Lumber Price: October 2012

Forest2Market’s composite lumber price increased by 1% in the month of October. The composite price at the start of the month was $293/MBF (Week 40), a 3% decline from the last week of September. Composite price increased in Week 41 to $294/MBF and continued to increase throughout the rest of October, with prices of $297/MBF and $306/MBF in Weeks 42 and 43, respectively.

The continued strength in lumber prices can be attributed to housing starts, which increased by 15% in September and another 3.6% in October. October’s starts were 41.9% above October 2011’s level. Rebuilding after Hurricane Sandy is expected to bolster prices as well.

Sales order volume per mill increased throughout the month of October as well, ending the month 26% higher than the end of September. Sales order volume per mill remained relatively flat in the first two weeks of the month (Weeks 40 and 41). In Week 42, however, we saw the largest volume transacted since Week 8 in February. Sales order volume per mill declined slightly from previous week’s high volume in Week 43.

Looking historically at lumber prices for the month of October, this year’s price is an anomaly. Pricing continues to display the same fluctuating trends that marked 2010 and 2011, though at an elevated price level: the composite is $45-$50 higher per MBF than it was in 2010 and 2011.

Note: The above figure summarizes pricing data gathered for Forest2Market’s weekly lumber market report, Mill2Market. For this market report, Forest2Market aggregates sales order data submitted directly by report subscribers. This figure charts weekly sales order prices from January 2010 through year to date 2012 and compares sales order data, FOB Mill on a volume weighted $/MBF basis. The prices in the figure are composite prices; they include dimension lumber, timbers and boards.

For more information, visit the Mill2Market page of our website, or call Bob Bratton at 980-233-4034.