Softening wood prices gives hope to homebuyers and renovators

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Analysts believe the recent easing of record lumber prices could provide slight relief for homebuyers and DIY enthusiasts while continuing to generate high profits for producing companies.

According to RBC analyst Paul Quinn, a drop of US $ 14 to US $ 941 per thousand board feet in the composite lumber price in North America on Friday represents the first weekly drop noted by the Observer of the Random Lengths industry since April 10. was US $ 367.

He says declines are expected to continue in the coming weeks, but pointed out that the November lumber futures contract rose US $ 28 in the same week to US $ 607. per thousand board feet.

Kevin Mason, managing director of ERA Forest Products Research, says prices are stabilizing after hitting record highs this summer because price-conscious buyers are delaying projects and the peak summer construction season is coming to an end.

However, he said the price change will simply take timber producers from “surprisingly profitable” to “remarkably profitable” levels, adding that he expects strong financial results for the rest of this year and possibly until 2021.

Random Lengths reported that oriented strand board, a board product commonly used to sheath new homes, remained unchanged this week at US $ 690 per thousand square feet, up from US $ 218 a year ago.

Home builders say the increase in forest products this year has added up to $ 10,000 to the cost of building a typical single-family home in Canada.

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