Lumber prices have drastically fallen this year as the industry grapples with the consequences of high home prices.
Lumber is trading at $608.6 per thousand board feet as of June 1, which is over 54 percent below the Jan. 13 peak of $1,329. Kevin Mason, managing director of ERA Forest Products Research, believes that lumber markets are “probing for a floor,” according to Bloomberg.
He estimates prices to soon fall to $400 per thousand board feet over the next two months, after which producers will likely restrict production to flush out excess supply.
Buyers have slowed down their lumber orders and sawmills have started cutting down their prices due to inventory buildup, according to a weekly price bulletin from Random Lengths. “Triple-digit discounts became the rule rather than the exception,” the service said in the bulletin, the Wall Street Journal reported….