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Lumber and Panel Prices
Not really bowhunting related but I know a fair amount of you commented on the "build anything" thread. Just giving some advice on the lumber and panel markets.
Lumber is getting close to the bottom, especially 2x4, 2x6 and 2x8, the wider widths are still pretty high but are sheading off more every week. I'd say a bottom will be reached in the narrows within a 1-2 weeks and wider widths maybe 2-4 weeks.
The panel market, CDX and OSB, are showing signs of weakness now. A few cracks have started to show up the past 3-4 days. I'd look for them to start the sharp down turn soon. Not sure how far it will fall. Some think it will be a small quick correction and then stay somewhat high, others think it will be a large drop before the bottom. No one seems to know what the bottom will be in the panel markets......will it be $10 OSB or will $20 be the new norm.
How long until these drops translate at the lumber yard/box store? I need to do have a deck built to finish out my home but no way was I going to pay the ridiculous lumber prices to have it built. I was lucky enough to not be impacted by any of the massive material increases while building the home and I didn't need a deck bad enough to pay through the nose to have it completed.
Thanks for the update Brett.
Bowfreak- Depends on how much lumber your local yard stocked up on at the higher prices. They won't be selling that at the futures prices that for sure. You'll get it at what they paid for it!
My bro's friends at church work at the local sawmill across the street (Montana). They too said prices are coming down. The problem isn't the timber supply....plenty of that. It's getting folks who want to work. I spoke to several business folks the last 4 days....that seems to be a problem across MT at the moment.
JL - I think that problem is all across the country. Many don’t want to work when they can stay at home and collect pay/benefits. The “soft” introduction to socialism.
I'm 4 weeks out from ordering my lumber package... 100k. One of my lumber guys called me last week and asked if I was ready. I told him I'm waiting til the last minute. He said the down turn hasn't hit the yard yet... he's sitting on a yard full, can't fit another stick in his yard... wanting me to pay for his high priced lumber. I'm hoping it breaks soon... real soon. I haven't seen a reduction at the consumer yet (Home Depot). Ed F
Go to a local sawmill and see what their prices are. Most deck material can be bought a lot cheaper and delivered especially from smaller sawmill.
I heard prices have started to go down. Down from where??
We’re on a family trip right now. We’ve driven from Missouri through Oklahoma and the Texas panhandle. New Mexico. Into Phoenix. Up to Sedona “Now hiring” signs everywhere!!!
Multiple restaurants shut down completely in Sedona because of lack of help.
It’s ridiculous. All these freaking shortages . . .
Lumber hasn’t showed the first sign of weakness here. Hopefully it will. But, hasn’t yet.
Every lumber yard I've been to is loaded down. Eventually it will have to pop.
I'm selling at big losses right now. I'd rather sell it for a 40% loss now than a 75% loss in another couple weeks. Prices have been falling at the mill level for 4 weeks now. Should be seeing better prices now and even better in another couple weeks. Panels have started the slip but won't show up at the retail levels for a few more weeks. Southern Yellow Pine has dropped the fastest and hardest with spruce taking a little longer to get there.
I’ve seen board lumber prices dropping here in the past 2 weeks, but nothing on the sheet - reason given is anything with adhesive is still holding strong.
The smart ones saw this coming a month ago and called large buyers, and dumped supplies at their cost. Giving people what they thought was a bargain at the time while getting rid of too much inventory they are soon going to be stuck with.
If that 40% is an accurate number, within a couple weeks we should be seeing 7/16 OSB in the $30/sheet range. Instead of the $49/sheet price as of now.
I am by no means doubting you. But, I don’t think retailers in this area are going to be as quick chasing the market down as they were chasing it up. Time will tell I suppose.
I never put a figure on the panel markets decline. It's coming but no idea how much yet. I'm selling 7/16 at $39 a sheet now. Was never higher than $44.
I check locally from time to time on the cost of zip wall board. It was around $23/sheet when I bought it in early 2020. It was up above $80/sheet at one time and has dipped below $70 now.
I still for the life of me can't see how people could or would afford to pay an extra $30-$50k to build a house during this lumber craze.
They can pay it now with cheap interest or pay it later when inflation boosts the interest rates.
Shipping and freight costs are just as much if not more to blame for the high retail prices. Crazy hard to find enough truckers right now.
I'm a millwork estimator for a large commercial millwork shop. I have to change my material prices every week. Sometimes twice a week. Makes it hard to quote something that may not deliver for 3-6 months from now...
Old School/adhesive holding strong? That's funny.
And every corner with a bum begging for my hard-earned money. Christian charity and enabling aren't the same thing.
"I still for the life of me can't see how people could or would afford to pay an extra $30-$50k to build a house during this lumber craze."
It's because they made 3 or 4 times that selling the home they had before this. In addition the appreciation of the home they are building now has gone up more than what they have lost on the lumber increase....just during the build! At least where I am building anyways. People are tripling the value of their home in 3-5 years time so that additional $50k isn't the end of the world for a lot of my clients. Trust me, no one likes it but you have to take it all into consideration if you're already in the ground......don't make sense to stop. Will be awhile before the yards get through the lumber they bought at the top. I don't see any relief in sight this summer.
I fully understand how this is happening......I just don't see how people can do it where I live. Nobody is lining up to live in eastern KY and my area is not as bad other areas in appalachia. What you say is true in a lot of areas but if you live somewhere like I do, home prices have remained stagnant. I can promise you no person where I live is making 3X what they paid for a home. I can see it in the future due to what we are experiencing now, but prior to this homes set on the market forever and you had to pretty much give them away. Home prices locally have definitely climbed recently due to all of these market forces but without this stimulus induced inflation people who paid 4X the cost to frame a house would be underwater because homes were already not appraising for what it costs to build them. You are correct in that currently inflation is driving up equity in homes. My newly built home, of which I haven't even made the first mortgage payment, appraised for 40% more than what it cost to build. However, when everything settles down you will need to have someone with a good job and a good income to pay for these homes and that is in short supply in the county where I live with a per capita income of $18,000 and a 20% poverty rate.
Bowfreak, you are in a different area for sure. Same goes for sone of WV too. But, everywhere else it is insane. People are building homes and selling them before they ever move in it themselves. That’s just an idea of the appreciation that is happening.
Brett, Are you selling to consumers or distributors? I also understand you didn’t go into osb. I was just trying to justify my feelings that 7/16 OSB board won’t leave the $30’s for consumers anytime this summer. Even if it did drop 40% retail cost in this area.
SBH hit the nail on the head. Same in my area. Price of my plumbing materials to do a house has drastically changed and that’s with plastic water pipe and drain pipe. Almost cheaper material wise to put copper water lines in (which is still 90% of our houses). Prices are crazy across the board.
And don’t try and get a water heater at a supply house. Doing a 7 apartment building and it took the distributer (FW Webb) a month to get me 7 of the same exact 50 gallon electric ones!
Last time we had this crazy run-up in house prices was circa 2005/06-ish. The correction wasn't pretty. I almost bought an over-priced house in the DC area when I was stationed there. Fortunately.....we chose to rent that tour. Thank God we did or we would have lost our shirt in the collapse.
I read this article this morning, prices definitely going in the right direction.
"Brett, Are you selling to consumers or distributors? I also understand you didn’t go into osb. I was just trying to justify my feelings that 7/16 OSB board won’t leave the $30’s for consumers anytime this summer. Even if it did drop 40% retail cost in this area."
75% retail end user and 25% I wholesale to other yards. OSB contracts this week are in the 1,100-1,175 range ($35.20-$37.60) for north east/mid atlantic. I was expecting a little lower but still think it will drop quite a bit. All year there's been little to no open market OSB available but now it's starting to show up more and more. By no means is the market flooded yet but some more OSB is becoming available. Stare down between the mills and dealers right now and I think the dealers will win.
If your holding. Sell, Sell, Sell
Thanks Brett. It’s fell off $4 and change since last week here in Princeton WV. New price this morning.
What are you guys seeing for steel prices
Bou - I buy stainless and it’s still very high with the mills expecting it to stay high thru 1st quarter 2022. At least that’s what they are saying right now.
7/16” OSB is Still higher than hell here in N Colorado
Our OSB is still high as well Brad - $53 for us though.
"What are you guys seeing for steel prices"
Strong and hard to source. Still increasing daily
"7/16” OSB is Still higher than hell here in N Colorado"
Brad, the central and western zones have a $300 per M premium to the northeast/mid atlantic/southern zones......roughly $10 per sheet. That gap will start to close soon.