When Will Lumber Prices Go Down Again?
With lumber prices on the rise once again in early February 2022, contractors and DIYers have found themselves asking once more, “When will lumber prices go down?”
In this Article
Lumber Prices at Home Depot in Southern Ontario
If you have sauntered through the lumber section at Home Depot in the last 4-6 weeks you may have noticed the sharp uptick in dimensional lumber. At the Newmarket location in southern Ontario, 2×4’s were priced to sell at $8.68 for a standard 8-foot long piece of SPF.
Similarly, if you were to purchase a 10 foot or 12-foot long piece of the same lumber, it would cost you $13.58 and $16.32, respectively.
Head over to Lowes or Home Hardware and you will find that the story unfolds in very much the same way.
Why Did the Price of Lumber Rise in Early 2021?
But what’s the cause and why the heck is history repeating itself? Haven’t we learned our lesson?
While the dynamics may have shifted to another side the public sees this as the same ol’ song and dance, though is it?
Last years lumber hike was primarily driven by a large percentage of the workforce adopting a “stay at home” regimen. Subsequently, those working remotely from their homes were looking to make better use of their space. Many others were just bored and looking to keep their minds and their hands busy.
What better way to pass the time than improve your home. Especially on projects that your significant others may have been accusing you of procrastinating, perhaps for years.
With this surplus of spare time DIY projects took priority and sent homeowners into building supply stores. Of course lumber is one of the first commodities purchased for many expansion gutting and renovation purposes.
All of these unexpected purchases four dimensional lumber depleted many home improvement Center’s leading to a shortage and thus price increase.
Eventually many consumers just had enough of the price gouging and ceased purchases causing the price of lumber to come crashing down.
Why Is the Price of Lumber Rising Again?
This time around the price hikes were propelled largely by public anticipation. Many contractors and other homebuilders were predicting a similar scenario as experienced just 6 months prior. It seemed more economical to stock up on supplies now and by doing so they could perhaps offset overly inflated costs that were just on the horizon.
This predictive pre-purchasing set the wheels in motion once again and ultimately sent prices back to the moon. The question of whether lumber prices will go down again and more specifically when that will occur is on everyone’s minds.
Unseasonably Warm Weather and Mountain Pine Beetle Continue To Hamper Lumber Productions in 2022
To top things off, disruptions in lumber harvesting on the west coast in BC were caused by overly wet weather. As a result production levels suffered. As if that werent enough, adding above seasonal fall and early winter temperatures into the mix allowed builders to continue well into the first half of the winter, depleting the already diminishing national inventory.
Furthermore, the ongoing Mountain Pine Beetle infestation throughout the forests of British Columbia continues to reek havok on overall yearly output. Usually kept in check by harsh winters, the effects of global warming over the last couple of decades have allowed these wood munchers to create exponential damage as their numbers continue to increase.
Covid-Causing Job Layoffs Not Helping a Worsening Economy
During the first wave of Covid in the winter of 2020, many folks were left without a job as cutbacks hit the workforce hard. Of course, safety was a big concern and all sectors were trying to minimize viral transmission.
Even now, two years later, many of these workers have not reported back to their workplace. This could easily cause even more of a hamper on production once the warmer seasons touch down in the continental USA durring the spring of 2022.
What the Analysts Are Saying and What Is Really Happening
Many analysts in the 1st quarter of 2022 have predicted that inventory levels and pricing would not match what happened last year. However, with framing members now at $8.68 for a 2×4 I think it’s safe to say that pricing is closer to last spring (when it was at its highest in history) than it was to last Sept/Oct when home improvement centres began reflecting the prices of falling lumber futures.
In the meantime, it would be prudent to expect the price of lumber to be stuffed with a mixed bag of volatility and unpredictability. When you think of all of the factors at play here, especially when viewing it in hindsight it seems inevitable that this would be the outcome. These ridiculous prices were an inevitable fate, just waiting to rear its ugly head.
Interestingly enough nobody could’ve put this together prior to the first occurrence in 2020. That is of course to say nobody without a crystal ball. Too bad none of us have one of those.
How To Deal With Rising Lumber Prices
The best advice for an end consumer, homeowner or bulk purchaser is, if possible, to be patient. All the panicking occuring in the minds of those skeptical that they will somehow “miss the boat” and have to end up paying is going to affect the overall pricing for everyone.
They (top publications, analysts, financial columns) said it wouldn’t ever go back to pre-pandemic prices, but as it turns out, it did. Albeit on the high end of those prices, but nonetheless. So at this point anything is possible.
However, realistically speaking, probably not until mid to late summer. Once the spring/summer surge has run its course, perhaps then we will be able to see the forest for the tree’s.
Yes, there certainly is timber at the end of the tunnel.
