Wood Woes 2021: When Will Lumber Prices Return to Normal?

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Wood woes for 2021 continue as customers still have to deal with rising lumber prices amid a shortage.

Field of trees.
Source: shutterstock
The real question that customers have is when will lumber prices return to normal? Unfortunately, we don’t have a definitive answer to that. The market is incredibly volatile right now with wood trading in unusual ways.

However, there is one prediction that might not make customers looking for lumber happy. Capital Economics’ Samuel Burman believes the price of lumber should see a sharp drop by the end of 2022.

That seems like a long time to wait, but lumber prices could decline over the next 18 months. Burman says this is likely going to happen due to increased domestic supply in the U.S., as well as additional imports of lumber.

Either way, that’s better than how the market is operating at the moment.

Take a recent sale from a lumber yard to a distributor earlier this month. That’s not something that normally happens. It’s the equivalent of sending a product up the distribution channel instead of down it.

At the same time, the rising price of lumber is keeping some customers from completing projects. That means homes, sheds, and do-it-yourself projects are being cancelled because customers can’t afford the materials to complete them. As a result, some lumber yards have an excess amount of lumber priced too high to sell, reports Bloomberg.

So while it will still be some time before lumber prices get back to normal, there is hope on the horizon. Just don’t get too impatient while waiting for it.

Lumber isn’t the only thing where a shortage is affecting prices.

There’s also been a global chip shortage as demand increases from crypto miners and the market recovers from the pandemic. That’s resulted in several semiconductor companies making the news. This includes Taiwan Semiconductor (NYSE:TSM), Lam Research (NASDAQ:LRCX), and Teradyne (NASDAQ:TER). Automotive stocks are also being affected by this shortage. You can learn more about this below.

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