The lack of new mill offerings made trading difficult in the lumber market yesterday. With prices higher, buyers were expecting a larger basket of products from the mills to buy and sell with. What they encountered were mills oversold on the many items they were searching for. Bidding up price or waiting a couple of weeks for did not entice the mills to sell more. Consequently the reloads received a lot of attention and a fair amount of the orders transacted, albeit at even higher prices. Many were left wondering where was all the lumber that was available just a few weeks ago.
6 Likes
Thank you @william_giguere! Is the problem at the mills or higher up in the supply chain? Loggers/concentration yards?
1 Like
One problem has been logistics and the lack of drivers. The mills have material on the ground but can only get so much out the door. Also important has been a continued conservative buying philosophy that has kept more new purchases restricted. Buyers would rather chase after material that they run out of rather than have extra inventory going into the winter months.
Thank you @william_giguere! This means that buyers are not worried about losing business from the retail/distributor customers on their end. There is such a shortage right now in construction that the home owners and developers are tolerant of these delays. Hence the buyers can continue with their conservative buying philosophy. Not feeling market pressure!