As sawmills across Canada and the US start to make their usual year-end curtailment and maintenance upgrade plans, producers look forward to a New Year 2018 as busy as it was this year.
These current high lumber prices have everyone boggling their minds, but it’s likely there will be some shocks coming at the start of next year as those prices could climb even higher.
Ongoing sustained strong demand — extremely unusual for this time of year — and the sharp reduction in timber supply to some critical areas due to the wildfires, as well as the imposition of a steep softwood lumber duty by the US on Canadian imports, are largely responsible for very strong lumber prices.
Current Softwood Lumber Prices Compared to Historical Highs
The below table is a comparison of November 2015, November 2016, February 2017, and November 2017 prices for benchmark Western Spruce-Pine-Fir 2x4s and Southern Yellow Pine 2x4s on the East side:
The graph below illustrates 15-year price trends for WSPF, ESPF, and SYP KD 2×4 #2&Btr (2002-2017).
US Thanksgiving Usually Year-End Slow Time For Lumber Selling
Sawmill order files, especially in the northwest, shrank down to one week or less as wood ordered a month ago finally made it’s way through the supply chain to anxious customers.
Most new ordering was for fill-in needs — as would be expected for this time of year — however locating suppliers with that mix of product on hand was tricky.
In the end demand has slowed down in this week following the big US Thanksgiving holiday.
At this point most operators are looking toward closing their yards for year-end. Québec will soon start on it’s annual two-week shutdown. Much stock-taking and inventory-accounting, of both logs and lumber, will be taking place.
Before the end of this year, much better word of the immediate loss of timber supply to areas of North America affected by wildfires is expected; most especially from the BC Ministry of Forests.