February 18th, 2020
Lumber Relief on Its Way?
This blog is going to be short, but sweet. And it’s on a topic that has potential impacts for the continued health of the U.S. building market: lumber.
As most of you are aware, Canada subsidizes its lumber industry by allowing public land to be harvested. In the U.S., timber is harvested on private lands, which is reflected in the associated costs. To even the playing field and give U.S. lumber producers a chance to compete, the U.S. applies tariffs to imported lumber from Canada.
However, a healthy housing market is fueling price increases on lumber across the board. Costs have risen steadily with the Random Lengths Framing Composite Price hitting $388 per thousand board feet on January 31–the highest level since October 2018 and up more than 20% since last May.
Rising lumber prices have created uneasiness among builders—understandably so—but it looks like there could be some relief coming. According to the National Association of Home Builders (NAHB), duties from Canada could be reduced by more than 50% in August of this year.
The View from Here is that any tariff reductions for U.S. builders is good news for everyone, including new homebuyers. I’ll be following this story closely. For more information, check out this article by NAHB.
What’s your View? Email me directly at email@example.com.