Is there a building project you’ve been putting off? Well, you might want to put it off awhile longer.
Lumber demand and prices are through the roof.
“We have seen price increases up to 180% on some lumber products,” said Larry Greener at Greener’s Budget Lumber of Birchwood, and formerly Barron. “Lead time to get products can be up to 8 weeks. All of our suppliers on windows, doors, cabinets, engineered wood products have extended lead time.”
As of the week of March 11, the price of lumber per thousand board feet is at an all-time high of $1,044, according to Random Lengths, an information service for the forest products industry.
That is up 188% since the start of the pandemic, which is a main driver of the rise in prices.
Mills shut down and supply chains were disrupted early on during the pandemic.
Next, housing demand increased and people stuck at home put more time and money into home renovations. But domestic mills haven’t caught up, and imports have slowed as shipping vessels remain log jammed at ports.
Long-term issues for the forest products industry have also played a role. Increasing populations of pine beetles in Canada and bark beetles in Europe for the past several years have diminished harvests.
Frequent forest fires out west have torched millions of trees that were slated for lumber production.
The fires and beetle infestations have been spurred by climate change, according to the scientific research journal, Nature.
These higher lumber prices are of particular concern to new home builders.
“We have found that new homes have raised in price about $15,000 to $25,000 from a year ago,” said Greener.
A key component of home builds, Oriented strand board (OSB), prices have risen 230 percent, according to the NAHB.
However, there is somewhat of a counterbalance in government stimulus payments and low interest rates.
“Low interest rates help to make up the difference over a 25 to 30 year mortgage (on new homes),” said Greener.
The National Association of Home Builders has pressed officials in both the Donald Trump and Joe Biden administrations on the lumber shortage.
A recent letter to Commerce Secretary Gina Raimondo urged the secretary to “examine the lumber supply chain, identify the causes for high prices and supply constraints, and seek immediate remedies that will increase production.”
A letter to Chief Victoria Christiansen of the U.S. Forest Service encouraged the department to, “continue your efforts to better-manage our national forests which will, at least in part, help strengthen the housing supply chain and promote affordable housing opportunities for all Americans.”
And further: “In 2020, the United States Forest Service had a year of historic timber production, selling more than 3.2 billion board feet (bbf) of timber, the second highest level in 20 years. This is welcome news in light of the current, record-high lumber prices and our nation’s ongoing housing affordability crisis. We may never return to the 10 bbf harvests that marked the 60s, 70s, and 80s, but a sustained, meaningful annual harvest from our public lands would help.”
Still, prices do not appear to be coming down any time soon—they may just keep rising.
“We do not look for much decrease in lumber prices until next year,” said Greener. “I have read articles that all countries are having the same problem as the U.S. We all need to plant more trees even if you have just small acreage. Every tree will help.”
A successful subduing of the pandemic will also help, and production will eventually catch up with demand.
Greener said some products are only up 5-10 percent in cost, but finding them could remain a challenge.
“To find products, keep checking with your local suppliers. They are all doing the best they can,” said Greener. “Also everyone needs to be patient. All suppliers will help you.”