Why Lumber and Plywood Prices are so High
Due to the pandemic, homeowners had extra time on their hands. During the summer of 2020, homeowners began projects on their homes, such as building decks, sheds, playhouses, and more. By the fall of 2020, homebuilders resumed their construction projects.
Why are Lumber and Plywood prices so high?
Lumber and plywood prices are very high right now because of the short-run dynamics of demand and supply. Wood products prices fluctuate more than most goods because homebuilding can move up or down much faster than sawmill capacity can.
Wood product companies would like to add capacity. However, building a new mill today would take more than two years to complete. Not to mention the difficulty they would have trying to hire new workers to run these mills. In addition, truck drivers are in short supply across the economy. These truck drivers are important to production, from moving logs to forests to mills and then distributing finished products to centers and lumberyards.
When will Lumber and Plywood prices drop?
Lumber and plywood prices will drop as demand falls. “Lumber and plywood prices typically rise in the spring and drop by the end of fall, by about five percent,” according to Forbes.com. “Building materials prices will retreat in 2022, returning to pre-pandemic levels by 2023.”