Lumber party: economic bounce fuels wood price rally
22 Apr, 2021 10:23 PM
5 minutes to read
Financial Times
US wood prices are racing higher amid a vigorous economic recovery from the pandemic, blasting through previous records as sawmills struggle to keep pace with demand in the run-up to peak homebuilding season. Lumber futures have soared by more than 50 per cent this year to more than $1,327 per 1,000 board feet length as housebuilders and DIY stores scramble for increasingly scarce supplies. That has taken gains since the depths of the Covid-19 crisis to 400 per cent, significantly above the contract s previous high of $650 set in 2018 (all figures US$).
Wednesday, April 21, 2021
Lumber prices are soaring.
The physical market for wooden framing 2x4 lengths of Western Spruce-pine-fir has risen 30 per cent since the start of the year to $1,205.
This follows an increase in the money supply over the last 12-months of 25%.
Wait until you see what happens to consumer prices over the next few months.
For money flow reasons, most new money printed by the Fed enters the capital goods areas first, then the non-durable consumer goods sector.
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