6 reasons why lumber prices are soaring in record-setting fashion – and why demand won’t die down anytime soon, according to 2 experts

 6 reasons why lumber prices are soaring in record-setting fashion – and why demand won’t die down anytime soon, according to 2 experts
  • Lumber prices have surged more than 275% since May 20, 2020.
  • A recent 8-day pullback from record highs ended on Thursday with futures rising to $1,390 per thousand board feet.
  • Two experts at Fastmarkets RISI explain why lumber prices have gone on a historic run, and why demand isn’t going away soon.
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Lumber prices have been on a tear over the past year, with futures rising more than 275% since May 20, 2020.

Over the past eight days, prices have retreated nearly 30% in a reprieve for home builders, renovators, and retailers. But Thursday saw the pullback come to an end.

Lumber futures rose roughly 5% from $1,201 per thousand board feet to $1,390 per thousand board feet on the day in a sign of sustained commodity cost increases for the markets.

Lumber’s continued surge has caused knock-on effects across the economy over the past year. According to The National Association of Homebuilders, lumber prices alone have added $36,000 to the average price of a new single-family home since April 2020.

Retailers like Home Depot have said that they are seeing demand for lumber like never before as well.

Home Depot’s chief financial officer Richard McPhail said in a Tuesday interview with Bloomberg that lumber sales are comparable to “a storm environment where literally as soon as you bring it in, it’s selling.”

Although the rise in lumber has been repeatedly discussed in the media,…

Read more…markets.businessinsider.com

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