US Lumber Prices Drop at the Beginning of November

SEATTLE (Scrap Monster):  US lumber prices have retreated from a six-month peak of $571 per thousand board feet on November 6, 2024, falling below $560 amid a stronger U.S. dollar and concerns over high interest rates. The Federal Reserve's hawkish stance, influenced by expectations surrounding the potential re-election of former President Donald Trump, has contributed to a surge in long-term interest rates. This, in turn, has pushed mortgage rates to their highest levels since July, creating uncertainty for the construction materials market.

Despite this retreat, lumber prices have gained over 7% in the fourth quarter, driven by ongoing supply constraints and some resilience in housing demand. Single-family home sales have reached a 16-month high, with pending sales seeing the largest increase since January 2023. Regional supply shortages, coupled with mill closures and rising wages, have further pressured prices.

Additional factors, such as U.S. tariffs on Canadian softwood and global supply constraints exacerbated by climate-related pest infestations, reduced logging, and Russia's export ban, have contributed to the tightening lumber market. These challenges continue to shape the outlook for the industry, adding upward pressure on lumber prices.

Courtesy: www.fordaq.com