As we have been forecasting, and with the data we have been providing, get ready for higher inflation.
Prices for lumber and building materials are setting new records as low-interest rates and a dearth of homes for sale surge consumer demand for new houses. However, 2020’s manufacturing slowdown and wildfires in the western U.S. have dried up the supply of building materials.
Prices have never been higher for oriented strand board, often used for walls and underlayment, Ponderosa pine for cabinetry, or southern yellow pine, often used in floors and decking, the Wall Street Journal reported.
Contracts for lumber to be delivered in March saw prices close above $1 per board foot on 19 February for the first time, the Journal said, noting that futures prices have shot up 49 percent this month.
Mills that manufacture engineered wood products such as I-beams are a month behind on filling orders, the Journal noted.
The materials shortage also was aggravated by the sudden rush to the suburbs by work-at-home white-collar employees and shuttered restaurants building outdoor dining areas, the Journal said.
Winter weather has disrupted imports from Canada; wood prices in Europe also are high, offering no competition to U.S. suppliers that would push prices down.
