Happy days are here again in the Southeast, where lumber sources report robust demand for their Softwood products.
The market has been “pretty crazy” in the Louisiana/Texas area, a lumber source said, noting that sawmill closures prompted by the coronavirus have resulted in a shortage of fiber. “So you’ve got a lot of Spruce buyers that have been supplementing with Pine. You’ve also got a surge in Pine from the home centers, who have been really driving this market because of everybody being home doing DIY stuff. Home Depot and Lowe’s are probably the busiest they’ve ever been.”
Southern Yellow Pine (No. 1, No. 2 and No. 2 Prime) in shorter lengths has been selling the best among his customers, who are retail lumberyards, industrials and treaters. The contact said some customers are concerned that prices might plummet similar to what happened in the last half of 2018. “Will prices jump off a cliff in six weeks,” he asked. “There’s a bunch of people who are not wanting to put on order files for two and three weeks out. Some guys are just buying prompt wood and they’re paying really close attention to their inventory and usages.”
It was a similar story in Georgia, where another lumber supplier said the Softwood market was really good because of reduced supply and increased demand. “I think it’s temporary, though,” he commented, “because some mills had shut down thinking this virus was going to back the demand off, but really it increased the retail demand to what it’s been because people had to stay at home and were fixing things, building fences and decks or whatever.”
SYP (No. 2 and No. 2 Prime) in 2×4 and 5/4 radius-edge decking (Standard and Premium) are his top-selling products. Customers are primarily treaters. “I think the only people in the Pine business who are slow are the people who build trusses. They seem to be a little bit off just because of the bureaucracy of people who have to be at their office in order to issue a building permit hasn’t been around. I think they’re working on existing permitted jobs still, but there haven’t been many new permitted jobs in the past four or five weeks.”
In Mississippi, a lumber contact said the Softwood market was very strong. “There’s near-unprecedented demand from treaters and big box stores,” he commented. “The demand among DIYers also has spiked strongly and, as a result, made prices go straight up on Pine dimension lumber, plywood and other related products. It’s as strong a market as I have seen in a long time.”
His lumber company serves the industrial market, where low-grade Southern Yellow Pine is most sought after in 2-inch through 4-inch sizes.
“Transportation has been relatively easy, especially for this time of the year,” the source said. “We’re beginning to see rates for certain routes go up incrementally, but nothing like the spikes we saw a couple of years ago.” Low diesel prices are helping to keep freight rates reasonable, he added.
