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November 2021 #13268 Page #104
Lumber Briefs By Matt Layman Publisher, Layman’s Lumber Guide
Where Did All the Lumber Go in October?
I
’m hearing two conversations. Mills wonder where all the wood is going and buyers wonder if there is going to be pull back to buy, particularly in the south. Granted those are not abundant conversations because most folks are sitting fat and sassy; perfectly comfortable.
Will we get a delayed fall correction in November? Could be. There is a divergence of activity. The ports are loaded with Euro wood coming inbound and outbound SPF, Dry Fir, and SYP is stuck. I say “coming in & going out” because that is the intention of those that put it there. However, there are chinks in the armor. Nobody gets paid until the wood is loaded or unloaded. On the west coast, lumber is piling up waiting on China to pony up letters of credit. They appear to be reneging on the orders. Will the mills and brokers just let it sit or will it be turned into cash? If the latter, we have a spot awaiting. SYP is being supported by northern treaters and EWP shortages. Northern treaters are wrapping up, for many, their best month of the year. I-joists are slowly catching up, but multi-family has made a significant transition to floor trusses, booked out 3–6 months. That means fewer I-joists needed, and strong demand for structural 2x4, particularly MSR currently. Meanwhile, builders are pushing back start dates which will slow contractor yard lumber flow. The divergence is the difference between recent buying and recent builder repositioning which has not yet made the news. Where is all the wood going? Lumber is prebought by builders 3–6 months ahead. I expect an early peak in 2022, March.
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