Lumber prices climb to record highs
Monday, February 5th, 2018
More rotten news about wood: Largely as the result of the tariffs imposed by the U.S. Commerce Department — and related negotiations among the U.S., Canada and Mexico grinding to a halt — prices for softwood lumber imports have skyrocketed 30% since Hurricane Harvey hit last summer.
“This was the highest week-end futures price we have on record, dating back to January 1995,” said David Logan, director of NAHB’s tax and trade policy analysis. “There was a short reprieve for price increases following the hurricane, but prices have risen sharply this month.”
Unlike lumber, OSB prices had been steadily declining in recent months. However, those declines came to an end last week when prices jumped 6%. The good news is that those increases are expected to be short-lived.
The near-term outlook appears uncertain, as softwood lumber negotiations seem to be at a stalemate. Canada has filed a complaint with the World Trade Organization as well as the NAFTA arbitration panel, accusing the U.S. of violating international trade rules.
“Using history as a guide, the most likely path forward is a lengthy litigation process during which lumber prices remain high,” Logan said. “Futures prices for 2018 delivery have increased substantially in recent weeks, suggesting that financial markets believe negotiations will be prolonged.”