Lumber Prices Cause Deep Concern, Calls for Federal Action
authors QR Staff | May 4, 2021
Soaring lumber prices are up over 250 percent from April 2020 to March 2021. According to the National Association of Home Builders, this has caused the price of an average new single-family home to increase by $35,872. For the week ending April 23, the price of framing lumber stood at nearly $1,200 per thousand board feet-up. Last April the price was roughly $350 per thousand board feet.
Further analysis by the NAHB found that the increased lumber price translates to an additional $13,000 in market value of an average new multifamily home, or an additional $119 a month to rent a new apartment. “These lumber price hikes are clearly unsustainable,” said NAHB Chairman Chuck Fowke. “Policymakers need to examine the lumber supply chain, identify the causes for high prices and supply constraints and seek immediate remedies that will increase production.”
For its part, the NAHB said it has increased its policy outreach to the White House and Congress as it seeks solutions that will increase lumber production and bring prices lower. NAHB CEO Jerry Howard and senior NAHB staff on April 29 held a virtual meeting with administration officials from the Domestic Policy Council, National Economic Council and the Office of the Vice President. The discussion covered mill capacity issues, mill worker shortages, and how soaring lumber prices are exacerbating the housing affordability crisis.
In Congress, members of the HBA of Greater Kansas City discussed the issue with Sen. Jerry Moran (R-Kan.) while Maine builders brought this to the attention of Sen. Susan Collins (R-Maine).
During a Senate hearing on funding for the U.S. trade representative, the two senators aired concerns about high lumber prices and tariffs on Canadian lumber.
“Where do the negotiations stand with Canada on softwood lumber?” Moran asked U.S. Trade Representative Katherine Tai.
“Softwood lumber will always be in my sights in conversations with Canada,” said Kai, who siad she will seek to “engage our Canadian counterparts in some out-of-the-box thinking on this issue.”
Later in the hearing, Sen. Collins voiced her lumber-price concerns. “I agree with my colleagues on the need for there to be a negotiation with Canada to renew the softwood lumber agreement. We’ve seen lumber prices go sky high. We obviously prefer domestic sources but when domestic sources can’t meet demand, we desperately need a new agreement to be negotiated so that we are not involved in imposing countervailing and antidumping duties on Canadian softwood lumber imports.”
NAHB calculated the $36,000 average home-price increases based on the amount softwood lumber that goes into the average new home as defined by Home Innovation Research Labs. Included is any softwood used in structural framing (including beams, joists, headers, rafters and trusses), sheathing, flooring and underlayment, interior wall and ceiling finishing, cabinets, doors, windows, roofing, siding, soffit and fascia, and exterior features such as garages, porches, decks, railing, fences and landscape walls.
The softwood products considered include lumber of various dimensions (including any that may be appearance grade or is pressure treated for outdoor use), plywood, OSB, particleboard, fiberboard, shakes and shingles—in short, any of the products sold by U.S. sawmills and tracked on a weekly basis by trade journal RandomLengths.com. – QR Staff | NAHB