Posted on 02/19/2022 2:33:15 PM PST by blam
The spring construction season is about to begin as homeowners face some of the highest lumber prices ever for this time of year.
March lumber futures in Chicago closed at $1,270 per 1,000 board ft. in Chicago on Friday, up more than 36% since the beginning of the month due to tighter Canadian supplies ahead of the spring building season.
Bloomberg reports the increase in lumber prices comes as Canfor Corporation, the world’s third-largest integrated forest products company based in Vancouver, British Columbia, announced a supply cut of 150 million board feet of production due to mountain pine beetle infestation that has devastated trees. Simultaneously, West Fraser Timber Co, the world’s largest timber company, reported port congestion and truck and rail car shortage make it challenging to transport lumber to buyers.
“In Western Canada, these transportation challenges are really unprecedented in both scale and duration,” West Fraser Chief Executive Officer Ray Ferris told investors on an earnings call last Wednesday.
Over three decades, lumber prices have never been higher for this time of year as the first and third-largest timber companies report supply woes.
Ferris said lumber and plywood shipments fell 20% year-over-year, and pulp shipments plunged 30% in January. He also said shipping “products in a timely manner remains challenged,” warning the company might be forced to take “unscheduled downtime” due to the transportation problems.
Tight lumber supplies ahead of the spring construction season in North America are likely to add more housing inflation to not just prospective homebuyers but also homeowners who want to remodel their kitchens or bathrooms.
Add lumber to the list of the “shortage of everything,” as Goldman Sachs’ head commodity strategist and one of the closest-followed analysts on Wall Street, Jeffery Currie told Bloomberg TV last week, “We’re out of everything, I don’t care if it’s oil, gas, coal, copper, aluminum, you name it we’re out of
Speculators need some place to place their bets.
Good construction lumber out here on the west coast, in the SW and Midwest has become a commodity in a super tight market and often going to the highest price, aka bid.
One of our MW relatives wanted to replace his master bath. He had to bid on the sink, toilet and walkin shower and the piping and a tank less water heater.
Then, he got into a bidding war for the lumber needed with a neighbor. Fortunately, the contractor had a customer cancel their lumber contract on another bathroom. So he and his fellow carpenters and plumbers were able to install the new stuff in our relatives home. Our relative ended up about 5G higher than the original cost estimate.
Last summer/august our contractor came out of retirement because of the demand from people like us.
We spent about 12k doing various upkeep things to stay in our home. Paint was going up in price all most daily.
The contractor told our sons that if we had waited until after September, our costs would have been close to 20K.
One of our younger relatives had a water softener unit leak in their kitchen. The insurance company paid $56 k for the damage. The check was written based on replacement costs for that day of their payment check.
So they had a lot of expensive construction and replacement gear in their home and garage until it was installed. They made sure that one adult family member was in the house at all times.
Their new Bosch dishwasher is on back order and will be hopefully available in May. The water damage happened in early June, last year while they were attending their daughter’s graduation on the east coast.
In the immortal words of BTO, “You ain’t seen n-n-n-nothin’ yet.”
how’d you like to be mid-build right about now...
“Canadian trucking shortage
How did that happen?”
Could be made worse if the truckers, pimped by Trudeau, now refuse to transport goods such as lumber and/or anything else. Just stay at home and refuse to work. A way must be found to get the frozen donations into their hands so that they can survive not working. Just refuse to transport goods and those that own trucks, park them in the driveway and let them sit. There is more than one way to skin a cat.
Wonder if this is where the old saying:
Nothing cures high prices like high prices. ?
PS lumber was over $1700 May 2021 so…..
I don’t know if you’re gonna wire that baby, but if you plan to, the price of Romex may knock you to the floor.
If there was a plot to destroy the housing industry, driving up the cost of materials is it. It is almost as if the anti-Capitalist DemonKKKrats took advantage of the pandemic to do it.
I’ve been out of the home building industry for a while.
How are the prices for concrete, brick and stone?
Biden hands out another parasite from the jar.
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