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Don’t Forget! You Saw it in the
January 2020 #12246 Page #100
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Lumber Briefs
Layman's Lumber Guide Lumber & Housing Market FORECAST
Component Manufacturer's Edition Matt Layman, Publisher By Matt Layman "The lumber market is easy to beat when you know what is going to happen." Publisher, Layman’s Lumber Guide
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Lumber & Housing Market Forecast
Buy Expectation, Sell Reality
In our lumber market, when presented with a Thew new year styrategy is to buy the expectation of higher disruptive opportunity that appears to create a supply prices based upon under bought conditions and positive trade shortage or demand surge, buyers increase inventory resolutions. This is not a long term play. It is only a strategy to on the expectation of higher prices, then once we employ until producers make appropriate supply adjustments. realize our over zealous preparation we liquidate Currently, buyers are in year-end inventory liquidation which those excessive positions, crashing prices. 2018 was only has two weeks remaining. CN railroad shipment delays. 2019 almost skated by Therefore, our LLG strategy is to attack this market with no event. Then last week President Trump immediately and cover as much of your anticipated needs all played his impeachment "trump" card...trade the way through February. Expect an early year peak with agreements with Mexico, Canada and China. In one prices falling in the spring. week, the export duties on US lumber, and ultimately Inventory management is going to be a bit tricky. Having lessened import tariffs on Canadian lumber, at first adequate supply for spring jobsite demand in a falling market glance is bullish for all North American softwood requires more frequent purchasing and timing your buys to take n our lumber market, when presented with a disruptive opportunity that appears to create a supply framing lumber. advantage of multi-week price cuts. We will want to take shortage or demand surge, buyers increase inventory onofthe expectation of higher downward prices; then, I expect these trade agreements will add to the advantage midweek and end-of-week priceonce bullish winter rally we have been forecasting for the adjustments. we realize our over-zealous preparation, we liquidate those excessive positions, crashing prices. last few discussions. Last week, prior to the Therefore, the immediate strategy is to buy aggressively until 2018 was CN railroad delays. 2019 almostcovered skatedthrough by with no event. week President presidential decrees, I told shipment you I was bullish ONLY February then Then, plan to last liquidate inventory in through played Februaryhis based upon fragile economic Trump impeachment “trump” card...trade March. agreements with Mexico, Canada, and China. In one conditions. The Fed's data-based economic evaluation Be very cautious about locking in prices over the next 10-12 week, export on US lumber, ultimatelyweeks. lessened import tariffs onincrease Canadian lumber,of at first means the we will have duties been 60-90 days in troubleand before Replacement costs will a minimum $10 per a confession. I'm prepping spring trouble, despite week and several weeks will top $20 increases. Statistically, we glance is bullish for all for North American softwood framing lumber. improving housing data. Housing's dependency on low should expect at least one $50 /mbft jump before mid February. interest rates and optimistic consumers makes it Be confidently bullish now. (Submitted December 17) fragile. I expect these trade agreements will add to the bullish winter rally we have been forecasting for the Looking Forward... ML
Buy Expectation, Sell Reality
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last few discussions. Last week, prior to the presidential decrees, I told you I was bullish ONLY through February based upon fragile economic conditions. The Fed’s data-based economic evaluation means we will LLG's Bullish, Bearish Neutral Sentiment have been 60–90 days in ortrouble before a confession. I’m prepping for spring trouble, despite improving Bullometer Most Bullish 100% housing data. Housing’s dependency on low interest rates and optimistic consumers makes it fragile. 75% 50%
The 25% new year strategy is to buy the expectation of higher prices based upon under-bought conditions 25% trade resolutions. This is not a long-term play. It is only a strategy to employ until producers and positive 50% make appropriate supply adjustments. 75% Most Bearish
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LLG 2x4#2 Composite (SYP-E, SPF-W, HF GDF) 2018-Current FTP's Forecasted Turning Points: Vertical arrows project times of reversals or accelerations. FTP Wk#
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PHONE: 800-289-5627
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Layman's Lumber Guide...Matt Layman, Publisher PO Box 905, Belmont, NC 28012 Phone or Text: 336-516-6684 Fax: 888-811-6917 Reprint or distribution is unlawful without permission. Email: matt@laymansguide.INFO www.laymansguide.INFO TWITTER @Laymansguide
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