Market Directions – Clear as Mud!

Conflicting forces at work in shaping lumber market forecasts continue to perplex:

  • A column today at The Globe and Mail makes for interesting reading. At the same time it does little to clear up the state of confusion dominating lumber markets of late: “Brutal winter weather straight out of a Charles Dickens novel has caused a sharp divergence in the price of lumber and home-builder stocks, making it difficult to discern the health of the U.S. housing market.” See How can home builders be surging while lumber tanks_ – The Globe and Mail
  • In the face of the Port Metro Vancouver strike, the ‘fractured’ supply chain might now be considered broken in two. Ken Shields, CEO of Conifex Timber Inc, reports lumber shipments will lag production by 20% in Q1. Full video of his informative interview on BNN this morning: Timber Tripped up by Truckers.
  • An acknowledged import shift in China amongst offshore traders, from lumber to logs, is backed by recent data: China’s log inventories have reportedly doubled in Q1 (from approx two million m3 in Dec 2013 to over four million m3 in March 2014 – HT Mark Kennedy, CIBC).

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