Timber Trends: Are Lumber Prices Rising or Falling?
Download MP3Introduction to Lumber Price Volatility
- Overview of dramatic price fluctuations over the past two years.
- Prices ranged from $300-$400 per thousand board feet, spiking to $1,500, and currently stabilizing closer to $500.
Factors Influencing Lumber Prices
- Housing Market Impact
- Real estate sales volume is low despite high home prices and slight interest rate decreases.
- Stalemate in new home construction and canceled buyer contracts impact lumber demand.
- Production Challenges
- Mills face reduced demand and workforce shortages.
- Lower production volumes due to profitability challenges.
- Interest Rate Environment
- Sustained higher rates (5%-7%) reduce housing affordability and construction volume.
- Lower throughput at mills limits further price drops.
- Price Stabilization Factors
- Mills and logging companies require a minimum price for profitability.
- Workforce challenges persist, complicating a return to pre-pandemic production levels.
- Impact on Builders and Contractors
- Questions about wholesale versus retail price alignment.
- Differences in lumber needs for new constructions vs. remodels or additions.
- Future Projections for Lumber Prices
- Likely stabilization between $450 and $580 per thousand board feet.
- Retail prices and project dynamics remain key indicators of market trends.
- Community Input Requested
- What trends are you observing at lumber yards or mills?
- Are retail prices reflecting the wholesale changes?
- Share insights on your project mix and its impact on lumber demand.
Tune in to explore what the future holds for lumber prices in an ever-changing market!
