Darren Satsky, Lumber Market Report, News, V3I6

Lumber Prices Setting Records

Yes, the lumber market is setting records … but why is it setting records?

Improving macro-economic forces, supply disruptions, unexpected natural disasters, and unresolved trade policy (Canadian tariffs) are combining to make market swings more volatile.

Let’s take a deeper look at why lumber prices are elevated and what you can do to manage your inventory.















The U.S. economy unexpectedly maintained a brisk pace of growth in the third quarter. The first reading on third quarter GDP was up 3 percent, vs. an expected 2.5 percent rise.

An increase in inventory investment and a smaller trade deficit offset a hurricane-related slowdown in consumer spending (because of Harvey in Texas and Irma in Florida), and a decline in

The economy was being powered by a tightening labor market.


WSPF 2 by 4 #2 and better prices increased approximately 16 percent over the previous 8 weeks. Prices of WSPF 2 by 4 and 2 by 6 #2 and better are near record highs.

ESPF 2 by 4 #2 and better prices rose approximately 14 percent over the same time period. SYP 2 by 4 #2 prices rose about 11 percent. Treated SYP 2 by 4 #2 prices were up about the same amount as the bright stock, 11 percent on average.

KD Western SPF studs were down approximately 2 percent, and Eastern SPF studs rose about 4 percent over the previous eight weeks.


U.S. Department of Commerce announced the final determination in the countervailing and anti-dumping duty cases against Canadian lumber imports.

Most Canadian producers will pay total duties of 20.83 percent on lumber shipments to the United States. Final duties will not be collected until the U.S. ITC gives a positive final ruling. That
decision is scheduled for December 18. If their ruling is positive then Commerce will issue CVD and AD orders around December 26.

It appears that any attempt to reach a negotiated settlement has completely stalled.

NAFTA negotiations continue sometime next year.


Distribution and wholesale inventories are currently extremely low. Carload wood bought last week is three to four weeks from hitting the ground.

End users are actively buying truckload wood on a daily basis, because it’s hard to buy multiple cars at today’s levels. Demand in the marketplace continues to be strong.

What should you do today? It appears we are in an extended period of elevated lumber prices. Though prices have increased significantly, be aware that the market will likely not provide much
price relief anytime soon. If it does, it’s likely a buying opportunity.

Meanwhile, prompt wood is king.


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