U.S. softwood lumber PPI rises 12.3% April

U.S. producer prices for softwood lumber rose 12.3% in April, according to Bureau of Labor Statistics data cited by Lesprom on May 13. The increase came as broader U.S. wholesale prices also accelerated, with the BLS saying its final-demand Producer Price Index rose 1.4% in April on a seasonally adjusted basis. Lesprom said softwood lumber prices were up 0.9% from a year earlier, while hardwood lumber, millwork and plywood also posted monthly gains. The move puts a volatile corner of the construction materials market back in focus. Madison’s Lumber Reporter said benchmark Western Spruce-Pine-Fir 2x4 #2&Btr kiln-dried lumber was $490 per thousand board feet in the week ending May 1, unchanged from the previous week and flat from a month earlier. The same Madison’s report described supply across the chain as low and transportation problems as persistent. (lesprom.com) ### How big was the April jump in lumber producer prices? Lesprom said the 12.3% April increase applied to U.S. producer prices for softwood lumber and was based on Bureau of Labor Statistics figures. The same report said the category was up 0.9% over the previous 12 months. Hardwood lumber rose 0.5% in April after a 0.1% decline in March, while millwork increased 0.7% and plywood gained 1.2%. (madisonsreport.com) Bureau of Labor Statistics data released on May 13 showed a broader inflation backdrop for producers. The agency said final-demand goods prices rose 2.0% in April, and the overall final-demand index increased 1.4%, the largest monthly advance since March 2022. ### What were cash lumber prices doing at the start of May? Madison’s Lumber Reporter said Western Spruce-Pine-Fir 2x4 #2&Btr KD was priced at $490 per thousand board feet in the week ending May 1. (lesprom.com) That was unchanged from the prior week and also flat from one month earlier, according to the report. Compared with the same week a year earlier, Madison’s said the price was up $30, or 7%. (bls.gov) The same weekly report showed a split inside softwood markets. Southern Yellow Pine East Side 2x4 #2&Btr KD was $505 per thousand board feet in the same week, down $30 from the previous week and down $56 from a month earlier. ### What did market participants say was driving conditions? Madison’s Lumber Reporter said inventories of solid wood materials remained low throughout the supply chain. (madisonsreport.com) The newsletter said buyers were reluctant to build inventories because of concern about higher replacement costs, and it said trucking and railcar availability were complicating deliveries and production schedules. Rapidly increasing fuel costs were “on the top of everyone’s minds,” Madison’s wrote in its market roundup. Lesprom separately characterized the April producer-price move as coming alongside gains in other wood-product categories tracked by the Bureau of Labor Statistics. ### Where does this show up for builders and contractors? (madisonsreport.com) Engineering News-Record said its construction economics archive tracks building material prices in 20 major U.S. cities, along with cost indexes and construction-put-in-place data. ENR said lumber and drywall prices appear in the third weekly issue of each month, while its Construction Cost Index, Building Cost Index and Materials Cost Index are updated monthly. (madisonsreport.com) The Bureau of Labor Statistics said nearly 60% of the April rise in final demand came from services, while prices for final-demand energy jumped 7.8%. Those broader cost pressures form part of the backdrop for wood-products buyers assessing spring purchasing conditions. ### What should readers watch next? May 13 is the latest published date for the Bureau of Labor Statistics’ April producer-price release, which included the softwood lumber increase. (enr.com) Engineering News-Record said its weekly construction economics tables continue through the month, with lumber and drywall prices scheduled in the third weekly issue and monthly cost indexes updated on a recurring basis. (bls.gov)