Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

Lumber Prices Are Falling Fast, Turning Hoarders Into Sellers
WSJ ^ | 6-15-21 | Ryan Dezember

Posted on 06/15/2021 7:09:01 PM PDT by dynachrome

Lumber prices are falling back to Earth.

Futures for July delivery ended Tuesday at $1,009.90 per thousand board feet, down 41% from the record of $1,711.20 reached in early May. Futures have declined 14 of the past 16 trading days.

Cash lumber prices are also crashing. Pricing service Random Lengths said Friday that its framing composite index, which tracks on-the-spot sales, dropped $122 to $1,324, its biggest ever weekly decline. The pullback came just six weeks after the index rose $124 during the first week of May, its most on record. Random Lengths described a chaotic rout in which sawmill managers struggled to provide customers with price quotes. It said late Tuesday that its index had dropped another $114, to $1,210.

Economists and investors have wondered if sky-high prices for wood products would doom the booming housing market. Builders raised home prices and many stopped selling houses before the studs were installed, lest they misjudge costs and sell too cheaply. Lumber became central to the inflation debate: whether a period of runaway inflation was afoot or high prices were temporary shocks that would ease as the economy moved further from lockdown.

(Excerpt) Read more at wsj.com ...


TOPICS: Business/Economy; News/Current Events
KEYWORDS: lumber; prices
Navigation: use the links below to view more comments.
first previous 1-2021-4041-55 next last
To: ocrp1982

“That said, what I stated holds true.”

Source?


21 posted on 06/15/2021 7:33:33 PM PDT by TexasGator (Z1z)
[ Post Reply | Private Reply | To 19 | View Replies]

To: Cowgirl of Justice

MUST have a fixed price contact when building a home. Cost plus contract = great way to get screwed while the builder abritrages with the customer being the loser.


22 posted on 06/15/2021 7:45:51 PM PDT by Levy78
[ Post Reply | Private Reply | To 7 | View Replies]

To: Jonty30

No problem, as I already have a fence, and thought a new one would be nice. I don’t make a habit of buying stuff at top dollar. If it don’t happen, it don’t happen.☺


23 posted on 06/15/2021 7:47:03 PM PDT by dragnet2 (Diversion and evasion are tools of deceit)
[ Post Reply | Private Reply | To 14 | View Replies]

To: alternatives?

Those prices haven’t budged because they bought in at May prices and they must run through that inventory.


24 posted on 06/15/2021 7:47:23 PM PDT by Levy78
[ Post Reply | Private Reply | To 15 | View Replies]

To: Jonty30

Not anybody who had common sense.

First thing. Do I really need that deck at this time?
Second. If I wait to replace it, where can I get wholesale lumber at low prices.

I wanted to do a couple projects. Dont need to do them now and they can wait till fall, or another year.


25 posted on 06/15/2021 7:47:24 PM PDT by crz
[ Post Reply | Private Reply | To 9 | View Replies]

To: Cowgirl of Justice

I wonder if they’d be just as quick to drop the prices too?


26 posted on 06/15/2021 7:49:33 PM PDT by Bulwyf
[ Post Reply | Private Reply | To 7 | View Replies]

To: dynachrome

Karate schools can now breathe a sigh of relief.


27 posted on 06/15/2021 7:50:17 PM PDT by P.O.E. (Pray for America)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Levy78

You are correct on home construction. It is surprising however that in large commercial some of the best fee limitation and cost savings is for “Cost-plus-a-fee with a Guaranteed Maximum Price. In 47 years and running hundreds of millions in projects, I made some of my biggest profits on lump sum contracts.


28 posted on 06/15/2021 7:55:43 PM PDT by KC Burke (If all the world is a stage, I would like to request my lighting be adjusted.)
[ Post Reply | Private Reply | To 22 | View Replies]

To: dynachrome
Supply and demand works.

The rest is behind a paywall.

You mean Tobin's Q and the Efficient Frontier etc are behind a paywall?

29 posted on 06/15/2021 8:02:28 PM PDT by DoodleBob (Gravity's waiting period is about 9.8 m/s^2)
[ Post Reply | Private Reply | To 1 | View Replies]

To: KC Burke

Same boat here. I ran a family custom home (and spec) biz for a decade a d we made the most money on fixed priced contracts. There’s a premium for predictability and typically had a dozen or so homes going at once and were able to get economies on contacts with subs and fix those prices, etc. You know how more works.


30 posted on 06/15/2021 8:02:55 PM PDT by Levy78
[ Post Reply | Private Reply | To 28 | View Replies]

To: ocrp1982

Sale of our house closes June 25th...whew


31 posted on 06/15/2021 8:04:16 PM PDT by goodnesswins (The issue is never the issue. The issue is always the revolution." -- Saul Alinksy)
[ Post Reply | Private Reply | To 10 | View Replies]

To: dynachrome

More good news I hope the hoarders gag on what they’ve got


32 posted on 06/15/2021 8:05:50 PM PDT by Sequoyah101 (Politicians are only marginally good at one thing, being politicians. Otherwise they are fools.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Pollard

Come back after you understand microeconomics.


33 posted on 06/15/2021 8:09:02 PM PDT by bigbob
[ Post Reply | Private Reply | To 12 | View Replies]

To: dynachrome

Well, if they can’t get top dollar for hoarded lumber, they can always make it into toilet paper.


34 posted on 06/15/2021 8:10:34 PM PDT by glorgau
[ Post Reply | Private Reply | To 1 | View Replies]

To: TexasGator

“Source?” NYSE. Commodities Market reports.


35 posted on 06/15/2021 8:12:27 PM PDT by ocrp1982 ( Bibicly)
[ Post Reply | Private Reply | To 21 | View Replies]

To: Pollard

It won’t go back to pre covid prices. It will bottom at about $800/1000 board feet. The run up enabled them to establish a new floor price, which is over twice what it started at.


36 posted on 06/15/2021 8:14:46 PM PDT by damper99
[ Post Reply | Private Reply | To 12 | View Replies]

To: dynachrome

7/16 OSB at Lowes is still $52.00 a sheet. It has not come down at all.


37 posted on 06/15/2021 8:15:26 PM PDT by Revel
[ Post Reply | Private Reply | To 1 | View Replies]

To: alternatives?
50 sheets of osb is $2800. You can't get a used truck for that
38 posted on 06/15/2021 8:35:01 PM PDT by vigilante2
[ Post Reply | Private Reply | To 15 | View Replies]

To: Ikeon

Home builders do not shop at Lowes.

They do not have what they use.

They are a DIY supplier.


39 posted on 06/15/2021 8:39:43 PM PDT by Texas Fossil ((Texas is not where you were born, but a Free State of Heart, Mind & Attitude!))
[ Post Reply | Private Reply | To 8 | View Replies]

To: Levy78

My cost plus projects were notable for superior performance in the quality and cost savings. I had a number of projects where the cost savings were so exemplary that I earned my company extra money from a very happy customer. Once I was awarded two new shopping centers during a financial closeout review. I also was audited by a financial team from hard buyer Wal-Mart. They found only $18.60 in Six Million that they did not agree with. It was in their favor and they gave us a complimentary letter and a check for $18.60 on the spot.

With a history like that I negotiated a lot of Fee-Basis work.


40 posted on 06/15/2021 8:40:13 PM PDT by KC Burke (If all the world is a stage, I would like to request my lighting be adjusted.)
[ Post Reply | Private Reply | To 30 | View Replies]


Navigation: use the links below to view more comments.
first previous 1-2021-4041-55 next last

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson