Monthly Archives

October 2015

Lumber Pricing Update October 2014

By | Professional Builder News | No Comments

John-Colley-Final-1024x1024The last time I checked in we had started to see that slow seasonal climb we typically experience in the fall.  2×4 and 2×6 pricing bottomed out in June, rose in July and has since traded ‘sideways’ to slightly up.  Last year 2×4 was commanding a premium over 2×6 and this year 2×6 has been commanding a premium over 2×4.  Specific lengths such as 10’ and 16’ continued to be pricier than 8’, 12’ and 14’.

Not much has changed with any of that.  In the current cycle of trading we bottomed out around October 1st and then pricing climbed through the first week of October.  This week the mill order files seem to have lightened up, but last week was a slow week for cash and futures trading.  There are a few ‘deals’ available but overall pricing seems to be flat with some specific items adjusting up or down.  Going forward, market reaction to any outside threats such as China stepping in would be my only concern with pricing moving upward in the short term.

Studs have been going back and forth while wide dimensional lumber has been flat.  Pricing from western mills on Hem Fir and Doug Fir have been better than Spruce pricing from eastern mills but the tradeoff seems to come with quality as all the “better” seems to have all been sorted out of the #2 and better from western mills.  Southern Yellow Pine followed a similar course as the eastern and western species with the narrower offerings such as 2×4 and 2×6’s stronger than the 2×8, 2×10, and 2×12’s which were flat.

Besides dimensional lumber OSB printed flat again.  There is good news for our region as Weyerhaeuser is back on line and trying to build an order file.  I kept thinking we would see a bump in pricing when Weyerhaeuser was down but this never happened. There still seems to be ample production so any bump would be due to obstacles outside of manufacturing such as trucking.  The orders we gave G.P. proved troublesome due to trucking issues which actually proved to be border issues.  I talked to a French Canadian driver who delivered a load of OSB to Zeeland Lumber & Supply. He explained that drivers are frustrated when crossing the border because traffic has been backed up for 3-4 miles, only two lanes are open and they have been waiting up to 6 hours cross.

What does this all mean to you?  I would say I don’t see anything other than seasonal adjustments and no major changes for the short term on the horizon.  I would continue to sell with confidence and I would rest assured that we are working hard to bring you reasonably priced lumber while keeping a critical eye on quality.  Use length’s like 8’, 12’ and 14’ for economy and use our Z-grade when you really want a nice appearance grade for studs and lineal.

 

Total Cost of Ownership

By | Products, Uncategorized | No Comments
There are many products in our industry over the years that are worthwhile considering the total cost of ownership. Too often, we put too much weight on the transactional cost, not the total cost. The total cost of ownership includes purchase cost, maintenance, resell or disposal, over the life of the product.  An example of this would be comparing a 10-15 year wood deck (including the maintenance), to a 25 year composite deck. Every 2-4 years a wood deck requires re-staining/sealing accruing the costs of material, labor and storage or disposal of the added paints and stains.
Another example is comparing PVC trim to wood trim.  Every study that I have seen on this supports paying a higher transactional cost for the premium product (unless the homeowner enjoys the weekend maintenance chores).  Using Dow foam, or Zip-R panel on your building envelope increases cost initially but saves energy bills, and also decreases the total cost of ownership. Using LSL studs in certain applications, andLSL bottom chords on attic trusses also increases transactional costs but decreases labor for future trades because of the precision for straightness.
Selling the premium product with a total cost of ownership mentality takes education.  One of our core values is career-long learning, and we are continually looking for ways to educate our customers on products and bring choice to the market place. Look for these type of events over the fall / winter months from Zeeland & make sure to save Thursday February 4, 2016 as the date for our Zeeland Partner Summit.
Mike-Dykstra-Small
Mike Dykstra
President & CEO
Zeeland Lumber and Supply
office 616.879.1158
mobile 616.836.2907