Softwood Lumber Prices Continue Upswing

Softwood lumber prices continued to rocket upwards last week amid acute supply shortages, says Madison's ‘Lumber Reporter.’ Prices were driven up by strong housing starts in the U.S., which purchases approximately 65 per cent of Canada's dimension lumber production mostly for home construction framing, while Canadian buyers account for about 10 per cent. The price of benchmark softwood lumber commodity item Western SPF (spruce, pine, fir) KD (kiln-dried) 2x4 #2&Btr (standard cost-effective grade) rose another $92, or 14 per cent, over the previous week to US$744 mfbm (million board feet). Canadian western SPF lumber producers, meanwhile, continued selling out every day, leaving not a speck of fibre for the U.S. market, it says. Producers in British Columbia report log supply was becoming a real problem in that province's interior. As for the east, sawmills in eastern Canada – specifically Quebec – are already on their yearly seasonal break and those in the west are not far behind with curtailments and closures. Usually at this time of year, construction activity is down to almost nothing and lumber producers are spending their time doing year-end accounts and taking inventory. Because demand has been so consistently strong, which is very unusual for December, lumber suppliers have been quoting wood sales into January 2021.