Lumber Prices Surging With No End in Sight
According to NASDAQ, lumber prices one year ago stood at $308.40. As of yesterday’s close, they were at $1,238.60, an increase of over 300% from a year ago – and that’s after coming down a bit from an all-time high set on 4/19/2021 of $1,326.70.
If that seems worrisome, experts warn that things are likely to get much wilder still in the lumber market. One expert told Fortune that the lumber market is “in trouble,“ and “could spiral out of control in the next few months.”
The COVID pandemic is largely blamed for causing the steep deficit of supply against overwhelming demand which has driven up prices: at the same time that production at the lumber mills was severely curtailed due to state-mandated lockdowns in the spring of 2020, millions of Americans, looking to keep themselves busy while quarantining at home with DIY home improvement projects – and with extra cash in their pockets from government stimulus packages, began buying large amounts of lumber from local hardware suppliers like Lowe’s and Home Depot. To make matters worse, a building boom sparked by low interest rates has continued unabated.
Although there are signs that the gap is being lessened (lumber production recently hit a 13-year high), doubt remains that supply will be able to catch up with demand quickly enough. So, it seems that high prices for lumber will be with us for a good while.