Inflation breaking in the lumber market?…
Lumber Prices Slump With Rising Interest Rates
Prices shed more than 50% since March, when the Fed began raising borrowing costs to slow inflation

Wood prices were a leading indicator of the supply-chain problems and inflation that followed pandemic lockdowns. Prices shot up in the summer of 2020 as cooped-up Americans remodeled en masse and demand for suburban houses soared. By last spring, lumber cost more than twice the prepandemic high. Now, two-by-four prices are flashing caution.

Lumber futures for July delivery ended Friday at $695.10 per thousand board feet, down 52% from a high in early March. On-the-spot wood prices have plunged, too. Pricing service Random Lengths said Friday that its framing composite index, which tracks cash sales, fell about 12% last week to end at $794. That is down from $1,334 in March, just before the Federal Reserve raised interest rates for the first time since 2018.


This morning in the donut shop with the guys who have position in the trades and real estate market, a major lumber company went under. I am not familiar with the company so this went in one ear and out the other. It was shocking to my friends. Inflation and unable to hire people.

I don’t understand the jubilation about lumber dropping from insanely high prices to just high prices. In 2019, lumber traded between 305 and 416. So trading at 695 right now means a 3-year “inflation” of 93%. That’s not considered “low inflation” using any definition.

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