North American Lumber Prices Set to Extend Gains in 2021

SEATTLE (Scrap Monster): According to Forest Economic Advisors LLC (FEA), the North American lumber prices are likely to extend gains in 2021, as demand is expected to outpace production, driven by increased homebuilding and renovations.

Paul Jannke, FEA noted that the huge bounce back of world economies post Covid-19 pandemic crisis will make it hard for lumber production to keep pace with rising demand. This in turn will lift the lumber prices to levels above that seen in 2020.

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The higher lumber prices could push the prices of new homes in North America. It must be noted that surging lumber prices led to average price increase by $24,386 of new single-family home in the U.S. over the past ten months, said latest data published by the National Association of Home Builders (NAHB). The skyrocketing lumber prices may also have significant impact on planned construction projects.

The lumber deficit in North America will be balanced through increased imports of wood products from European region, especially from Central European countries. The European lumber production is expected to exceed consumption, thus allowing for exports to other countries, including the U.S. The overall U.S. lumber imports are projected to increase by roughly 15% in 2021.

Further, FEA sees China boosting its lumber imports by around 14% during the current year.