Record prices for lumber aren’t built to last

Best to make a plan…

By Myra P. Saefong
May 12, 2018

Lumber prices have rallied more than 30% this year to reach their highest level on record, as U.S. duties on imports of the commodity from Canada have contributed to tighter supplies and soaring home-construction costs. But analysts are growing wary of tall timber prices. Among the possible threats is the World Trade Organization’s recent compliance with Canada’s request to examine the dispute by establishing two panels to rule on higher U.S. lumber duties. Technical analysts claim lumber prices are vulnerable because they’ve gotten above their fundamental value. …The lumber market has “all the hallmarks of an unsustainable bubble,” says Zimmermann. And “in line with the bursting of bubbles in the financial markets,” lumber prices may peak by midyear, then drop over the next few years and on into 2021-22, he says.prices.

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