摘要：Cash forward contracting is a common, and often preferred, means of managing price risk for agribusinesses. Despite this, little is known about the performance of cash forward markets, in particular the role they play in price discovery. The lumber market provides a unique case for examining this issue. The Bloch Lumber Company maintains an active cash forward market for many lumber products, and publishes benchmark forward prices on their website and disseminates these prices to data vendors. Focusing on 2x4 random lengths lumber and 7/16 oriented strand board, this research examines the lead-lag relationships between the three-month forward prices published by Bloch Lumber and representative spot prices. Results suggest that at least for 2x4 random lengths lumber, the forward prices published by Bloch Lumber lead the spot price. However, spot prices do not lead the forward prices for 2x4 random lengths lumber, but do for oriented strand board. While these results suggest that the Bloch Lumber forward cash prices are contributing to price discovery, the dominant market for price discovery may be an existing spot or futures market.
