Excerpted from CFP Q2 report. North American lumber demand was solid across all segments of the market in the second quarter of 2016, with US housing starts in line with the previous quarter, averaging 1,160,000 units on a seasonally adjusted basis. Canadian housing starts were also broadly also in line with the previous quarter, at an average of 198,000 units on a seasonally adjusted basis. Offshore lumber demand remained steady during the quarter.
The average benchmark North American Random Lengths Western SPF 2x4 #2&Btr price was US$311 per Mfbm in the second quarter of 2016, up US$39 per Mfbm compared to the previous quarter, with similar price increases seen across most other dimensions and grades, with the exception of Western SPF 2x6 #2&Btr price which showed a more modest increase. Western SPF unit sales realizations benefitted from the higher US-dollar benchmark lumber prices as well as a higher-value sales mix. Partly offsetting these factors was the 7% stronger Canadian dollar during the quarter. SYP unit sales realizations also increased compared to the previous quarter reflecting both a US$30 per Mfbm increase in the SYP 2x4 #2 price, and more pronounced price increases in most wide-dimension SYP lumber products which represent a significant proportion of the Company's product mix in the US South.
Total lumber shipments and production were in line with the first quarter of 2016 as the recent acquisition of Wynndel offset slightly reduced production in Western Canada as a result of the Houston sawmill's kiln fire. Unit manufacturing costs in the second quarter of 2016 were in line with the previous quarter.
Positive pricing momentum in global softwood pulp markets during the second quarter of 2016 was due mostly to the impact of industry spring maintenance outages and solid demand, particularly from China. The average North American US-dollar NBSK pulp list price, as published by RISI, was up US$37 per tonne, or 4%, to US$980 per tonne, while the average price to China was up US$27 per tonne, or 5%.