Posted January 31, 2018

Softwood lumber prices hit record highs

Tariffs help hike imported lumber prices 30 percent since Hurricane Harvey.

Prices for softwood lumber imports have skyrocketed 30% since Hurricane Harvey hit last summer, largely as a result of the tariffs imposed by the U.S. Commerce Department, says the NAHB blog.

“This was the highest week-end futures price we have on record, dating back to January 1995,” said David Logan, director of NAHB’s tax and trade policy analysis. “There was a short reprieve for price increases following the hurricane, but prices have risen sharply this month.”

On the other hand, OSB have been declining in recent months, but jumped 6% last week. The price jump is expected to be short lived.

The near-term outlook appears uncertain, as softwood lumber negotiations seem to be at a stalemate. Canada has filed a complaint with the World Trade Organization as well as the NAFTA arbitration panel, accusing the U.S. of violating international trade rules.

“Using history as a guide, the most likely path forward is a lengthy litigation process during which lumber prices remain high,” Logan said. “Futures prices for 2018 delivery have increased substantially in recent weeks, suggesting that financial markets believe negotiations will be prolonged.”