More Lumber Price Increases on Tightened Supply
The sawmill curtailments of recent months, especially those ongoing in the western part of North America, served to bring lumber prices up slightly. At this point, levels are still somewhat below cost-of-production in the important supply basket of British Columbia — which has been roughly estimated at approximately US$500 mfbm. The strategy of reducing production, carried out in a quite disciplined way, is mainly to prevent prices from falling even further.
While building and construction activity is relatively good for the time of year, there are a lot of questions about what will happen with this year’s spring building season. Will it be strong as the past two years, or muted due to the increasing mortgage rates? It is too early to tell right now, so sawmills continue to hedge manufacturing volumes against potentially softer 2023 new housing starts.
In the week ending February 3, 2023, the price of Western Spruce-Pine-Fir 2x4 #2&Btr KD (RL) was US$460 mfbm, which is up by +$66, or +17%, from the previous week when it was $394.
That week’s price is up by +$88, or +23%, from one month ago when it was $373.
FULL STORY: LinkedIn
