Despite inflation, lumber prices have returned to pre-pandemic levels
Inflation was a topic that dominated many conversations in 2022. But as the price of eggs and gasoline climbed, the price of another hot commodity moved in the opposite direction.
Lumber prices fell 63 percent in 2022.
The trend is continuing into the new year, marking a reversal of record high prices during the pandemic.
At about $365 for 1,000 board feet, lumber prices are lower now than they’ve been in more than two years.
“They’re about where they were before the pandemic started,” says Rick Wilson, the President and CEO of Pukall Lumber in Arbor Vitae.
He says the pandemic caused labor shortages, which created supply issues for larger sawmills. At the same time, demand for lumber spiked, as people tackled home renovation projects and construction boomed.
Those factors contributed to a pandemic spike in lumber prices, but lately, those factors have stabilized. As a result, lumber prices have plummeted.
“Recently, the price has come down significantly. Since mid-year 2022, it’s dropped pretty steadily,” Wilson says. “And that’s probably where it’s going to stay.”
That’s not the case for other building materials though.
“Other building materials, like windows and doors and some other metal products, those products are still high and they probably will remain high,” Wilson says. “I don’t see those coming down during the year at all.”
He says that’s because those products are labor intensive, and there’s still a labor shortage.
As the market continues to shift, he’s waiting to see what inflation, interest rates and the labor shortage will mean for business.