The National Association of Home Builders reports on its Eye on Housing blog that the price of lumber, from framing to structural panels, has increased in recent weeks with some prices rising more than 30%.
Softwood lumber prices have been relatively steady since 2014, NAHB reports. During this period, the largest one-week price increase of framing lumber (+6.8%), as measured by the Random Lengths Framing Lumber Composite Index, occurred in the middle of the recent price escalation. The largest one-month swing of softwood lumber during this period was 2.9% in 2014 according to the Bureau of Labor Statistics Producer Price Index (PPI).
The trade agreement that has governed Canadian imports of softwood lumber since 2006 effectively expired at the end of 2016, the mechanics and consequences of which are discussed below. Failure to reach a new agreement is the primary catalyst of market-wide price increases. The outlook of a new pact between the U.S. and Canada and thus, lumber prices, is highly uncertain at this point. However, price trends in the 2001-2006 period (the last time negotiations were held) may offer clues as to what lies ahead.
See the NAHB blog for the full story.