North American lumber producers are offering more concessions to secure orders, but lower prices have yet to persuade buyers to build inventories, according to market feedback received by GWMI. Customers continue to purchase against immediate requirements, leaving mills to compete for business as the construction season slows.<\/p>\n
The weakness is also spreading into lumber used for pallets, crates and other industrial products. More material is becoming available, while falling construction-grade prices are giving industrial buyers alternatives to their usual purchases. Freight costs, however, continue to absorb part of the savings available at the mill.<\/p>\n
The lumber price index fell to USD 495 per thousand board feet on October 23, from USD 499 on October 16 and USD 500 on October 9. The two-week decline was 1%, extending the gradual weakening seen earlier in the month.<\/p>\n
Individual products have experienced much larger adjustments. The October 9 price snapshot shows green Douglas fir falling particularly sharply, while Western spruce-pine-fir studs also lost more ground than standard framing lumber. Eastern spruce-pine-fir remained unchanged over the week, although its price was below the month-earlier level.<\/p>\n
Canadian softwood plywood, Toronto 9.5 mm, was quoted separately at CAD 687 per thousand square feet, down CAD 7, or 1.01%, over the week. Compared with the displayed month-earlier price of CAD 696, the decline was CAD 9, or 1.29%.<\/p>\n
The Douglas fir adjustment stands out. Its price fell from USD 425 to USD 360 over a month, a reduction of more than 15%. Western SPF studs declined by 7.53% over the same comparison period. These movements show why a relatively small change in a general index can understate the negotiating opportunities available in specific products.<\/p>\n
Market feedback received by GWMI indicates that Southern Yellow Pine production is exceeding current sales, with narrow dimension lumber under pressure and discounts becoming more common in timbers.<\/p>\n
Buyers appear to see little advantage in committing early. When prompt material is readily available and offers continue to weaken, purchasing additional stock creates a risk that competitors will obtain the same products more cheaply a few weeks later.<\/p>\n
For mills, this behaviour makes inventory management more difficult. Maintaining prices can leave production unsold, while discounting releases working capital but may reinforce expectations of further reductions.<\/p>\n
Some industrial buyers are also finding discounted Southern Pine 2\u00d710 boards attractive as raw material for narrower components. Operations equipped to rip wider boards may be able to cover certain requirements more economically than by purchasing narrower widths directly.<\/p>\n
The calculation must be based on usable output. Actual dimensions, saw kerf, defects, labour and handling costs determine whether a lower purchase price survives processing. A wider board offers little advantage if cutting losses or rejected sections consume the saving.<\/p>\n
This option is most relevant to industrial components produced to agreed specifications. Buyers should not assume that ripping structural lumber preserves its original grade certification.<\/p>\n
The relationship between construction-grade and lower-grade lumber is becoming increasingly important for pallet and crate manufacturers.<\/p>\n
Trade feedback received by GWMI points to more lower-grade material being offered by mills. But as construction lumber becomes cheaper, the price difference narrows. An industrial buyer may then find that paying slightly more for better-quality boards produces fewer rejects, better recovery or less processing work.<\/p>\n
That substitution puts additional pressure on lower-grade prices. Mills must preserve enough of a discount to make this material attractive relative to the better grades.<\/p>\n
It also explains why industrial lumber prices can weaken without a collapse in pallet or packaging demand. The immediate problem may be the volume and assortment mills are offering, together with competition from discounted construction lumber.<\/p>\n
September manufacturing data support a more measured view of industrial demand. ISM\u2019s Manufacturing PMI stood at 54.5, indicating expansion, while its New Orders Index increased to 55.3 from 53.7. Customers\u2019 inventories remained low, with that index at 41.6. These are economy-wide manufacturing indicators rather than direct measures of pallet demand, but they do not point to a general industrial contraction.<\/p>\n
Seasonal packaging orders could help absorb available lumber. Whether they are sufficient will depend on the specifications required and how quickly mills continue adding material to the market.<\/p>\n
The residential construction pipeline remains a constraint on framing-lumber demand.<\/p>\n
US Census Bureau figures show that single-family building permits fell 4.0% in September to a seasonally adjusted annual rate of 845,000, from 880,000 in August. Estimated single-family housing starts declined 4.6% to 859,000. Total starts were estimated at 1.221 million, down 5.2% over the month, although the starts estimates carry substantial statistical uncertainty.<\/p>\n
Permits do not translate immediately into lumber purchases, but they provide an indication of future construction activity. A weaker single-family pipeline reduces the incentive for builders and distributors to acquire stock well ahead of confirmed projects.<\/p>\n
Low customer inventories therefore do not automatically imply that a large restocking cycle is imminent. Buyers can continue operating with limited stock when supply is accessible and delivery times remain manageable.<\/p>\n
For sellers, the more useful signal would be customers extending their purchasing horizon beyond immediate jobs. Feedback received by GWMI suggests that this has not yet become a widespread pattern.<\/p>\n
Freight remains an obstacle even where lumber itself is becoming easier to buy.<\/p>\n
Reports received by GWMI indicate that seasonal goods are competing with lumber for trucks and rail equipment, adding to delivery difficulties and high fuel costs. Weak lumber demand has therefore not removed the logistical constraints affecting individual transactions.<\/p>\n
A lower mill offer may come from a more distant supplier, involve an uncertain loading date or require expensive transport. Once those costs are included, a buyer may find that the delivered saving is much smaller than the quoted lumber discount.<\/p>\n
Mills can also struggle to clear stock that has already been sold if transport equipment is unavailable. Delayed shipments occupy yard space and complicate loading and production schedules.<\/p>\n
This creates an uneven market: customers have greater bargaining power over the wood, but less control over the cost and timing of moving it.<\/p>\n
Changes to US duties offer Canadian exporters some relief, although the benefit differs substantially between producers.<\/p>\n
Global Affairs Canada lists combined antidumping and countervailing rates of 24.75% for the reviewed \u201call others\u201d category, 31.11% for Canfor, 25.55% for Resolute and 20.02% for West Fraser. The separate 10% Section 232 tariff remains applicable to covered softwood lumber products.<\/p>\n
For shipments subject to both measures, the resulting combined headline burdens are 34.75%, 41.11%, 35.55% and 30.02%, respectively. The widely quoted 34.75% figure is therefore not a uniform rate applying to every Canadian supplier.<\/p>\n
Lower duties can improve an exporter\u2019s net return, support a more competitive offer or allow a combination of both. How the benefit is divided depends on market conditions and the producer\u2019s need to secure orders.<\/p>\n
The change does not generate additional consumption. With customers still purchasing cautiously, competition could transfer part of the duty relief into lower selling prices rather than stronger mill margins.<\/p>\n
The current pricing weakness is developing alongside a redistribution of North American sawmill capacity.<\/p>\n
Bearlodge Forest Products plans to close its sawmill and pallet operations in Hulett, Wyoming, on October 31 after nearly five decades of operation. The company cited rising costs, labour and housing constraints, and prolonged weakness in product prices.<\/p>\n
At the same time, announced sawmill openings and expansions in the US South are estimated to add 2.1 billion board feet of annual capacity between 2026 and 2028, net of closures. That represents potential manufacturing capacity, not a guarantee of equivalent additional production.<\/p>\n
The purchasing implications extend beyond total volume. A new Southern Pine mill does not necessarily replace the species, lengths, grades or industrial products previously supplied by a western operation. It also serves a different transport network.<\/p>\n
Modern scanning and grading systems can change the proportion of output recovered into higher-value products. The resulting availability of lower-grade industrial lumber depends on the logs processed, mill equipment and production decisions.<\/p>\n
Consequently, North America can have substantial total sawmill capacity while particular buyers face fewer suitable local suppliers.<\/p>\n
\nGWMI assessment<\/p>\n
The strongest immediate pressure is on mills carrying material that customers can readily source elsewhere. Lower offers are helping sellers compete for orders, but they have not yet established a reason for buyers to hold more inventory.<\/p>\n
Industrial grades are a particular point to watch. If construction-grade prices continue falling, pallet and crate manufacturers may increasingly purchase better-quality boards at a small premium. That would force further adjustments in lower-grade prices, especially where mill inventories are already growing.<\/p>\n
A more lasting improvement would require orders to absorb available production, reducing the need for discounted stock offers. Until then, cheaper lumber is likely to shift business between suppliers more readily than it increases total demand.<\/p>\n<\/blockquote>\n
\nSelected North American lumber prices<\/p>\n
Week ending October 9, 2026 \u00b7 USD per 1,000 board feet<\/p>\n
\n\n\n
\n \nProduct \/ category<\/th>\n Price<\/th>\n Weekly
\nUSD<\/th>\nWeekly
\n%<\/th>\nMonthly
\nUSD<\/th>\nMonthly
\n%<\/th>\n<\/tr>\n<\/thead>\n\n Western spruce-pine-fir, 2\u00d74
\nKiln-dried, No. 2 & Better<\/span><\/th>\n454<\/td>\n \u221210<\/td>\n \u22122.16%<\/td>\n \u221218<\/td>\n \u22123.81%<\/td>\n<\/tr>\n \n Southern Yellow Pine, East, 2\u00d74
\nKiln-dried, No. 2 & Better<\/span><\/th>\n481<\/td>\n \u221214<\/td>\n \u22122.83%<\/td>\n \u221210<\/td>\n \u22122.04%<\/td>\n<\/tr>\n \n Eastern spruce-pine-fir, 2\u00d74
\nKiln-dried, Standard & Better<\/span><\/th>\n600<\/td>\n 0<\/td>\n 0.00%<\/td>\n \u221216<\/td>\n \u22122.60%<\/td>\n<\/tr>\n \n Western spruce-pine-fir, 2\u00d74 studs
\nKiln-dried, precision-end-trimmed<\/span><\/th>\n405<\/td>\n \u221210<\/td>\n \u22122.41%<\/td>\n \u221233<\/td>\n \u22127.53%<\/td>\n<\/tr>\n \n Douglas fir, 2\u00d74
\nGreen, Standard & Better<\/span><\/th>\n360<\/td>\n \u221220<\/td>\n \u22125.26%<\/td>\n \u221265<\/td>\n \u221215.29%<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n \n<\/div>","protected":false},"excerpt":{"rendered":"
North American lumber producers are offering more concessions to secure orders, but lower prices have yet to persuade buyers to build inventories, according to market feedback received by GWMI. Customers continue to purchase against immediate requirements, leaving mills to compete … Continue reading