Lumber prices trending downward

LOUISVILLE, Ky. — When it comes to working with wood, Alexander Johns and Sean Schmitt are experts. They’re best friends, and together co-own A&S Construction in Louisville.

What You Need To Know

• The price of U.S. lumber has gone down according to Trading Economics


• Prices in a year have dropped almost $200 per 1,000 board feet


• Business owners believe COVID caused demand and prices to go up

We do everything from decking, siding, windows, gutters and roofing to bathroom remodeling inside.” Johns said.

They have been in business for two and a half years and they say it’s been great. Decking has been one of their most popular projects, which means they buy and use a lot of lumber. Johns keeps a close eye on lumber prices.

“Throughout the last few months, lumber prices have substantially dropped back to numbers that most people are used to. At this point, it’s really a great time to get into remodeling.” Johns explained.

Data from Trading Economics shows volatile lumber prices. Compared to Oct. 2022, when the price per 1,000 board feet was over $640. The price as of Sept. 21, 2023 prices dropped to $478.

Johns said just this year, some deck boards went as high as $30 per 16-foot board at one point. Now, he says the price is about half that.

“It makes us feel great. We can provide better pricing to homeowners. We can provide better value and upgrade lumber, for example, to premium deck boards.” Johns said.

Spectrum News 1 asked Schmitt some reasons he thinks lumber prices are dropping.

“I think most of the manufacturers upped their supply due to the demand they’ve seen in COVID. As some of the commercial work around the local area has ceased, due to demand being met. I think some of the manufactures have had additional wood on hand and they’ve started to lower their prices in order to get more people to purchase the wood,” Schmitt explained.

Johns said it’s great for businesses and homeowners too.

“There are some customers that have specifically been waiting for [the price of] lumber to go down. Now is the right time. I can’t imagine they’re going much further down. If anything, they’ll probably go up over time,” Johns explained.

They said they would love to see the prices of lumber go down further. 

Anyone who has dealt with a hard to ignite burner or a stubborn car knows the feeling. You work and work to finally get it started, only to have it peter out shortly afterwards.

Framing lumber traders could be forgiven for feeling that way about the market so far this year.

Through the first seven months of 2023, the Random Lengths Framing Lumber Composite Price (FLCP) has had three upswings. The first one, in January and early February, lasted five weeks and the composite gained a total of $73 during that span.

The second spurt ran from mid-March through mid-April. In a span of six weeks, the FLCP was flat twice and gained a total of $18 over the other four weeks.

The third run went from mid-June and went six weeks through mid-July. The total gain over that period was $81. Through the end of July, the FLCP had gone up 15 weeks thus far in 2023, dropped for 12 weeks, and was flat for the other three weeks. At the end of 2022 the FLCP sat at $380, while it was $463 at the end of July 2023.

First half of 2023 compares favorably to previous years

Based simply on the numbers, the first seven months of 2023 weren’t too bad in the lumber markets. While a gain of $83 since the end of last year may not seem like much, it compares quite favorably not only to what transpired the last couple of years, but historically as well.

In 2022, the FLCP plummeted $389 through the end of July when compared to how the previous year ended. That was nearly identical to the $395 drop registered in the previous year. In 2020, soaring demand early in the covid-19 pandemic pushed the price up a record $254 in that period.

Over the last 10 years, the FLCP gain in the first seven months of 2023 is the highest aside from 2020 (chart), and the most since a $137 gain in the like period of 2004. The FLCP has gained in six of the last 10 years, including five straight years from 2016 to 2020.

Although the numbers would suggest a positive first half of 2023, sentiment and anecdotes don’t seem to back that up. A sense of confidence among buyers and a willingness to speculate are often evident in positive markets.

Instead, a particular concern among traders this year has been the ongoing lack of interest and urgency from buyers. Throughout 2023 to date, buyers have become accustomed to being able to wait until the last minute and fill in holes with prompt truckloads, or even partial truckloads. Speculative purchases have been next to nil for many months.

In addition, the strongest run thus far in 2023, the third one, came on the heels of a surprisingly strong May US housing report. There was plenty of skepticism about the robust numbers in the report, and once the revised and drastically lower numbers came out a month later, any sense of urgency disappeared from the market.

As such, traders have tended to look at that third run – as well as the other two shorter, modest upticks – as examples of the fire in the market not being sustained after initially catching. Each of the three times, producers felt things were finally going somewhere. Each time, modest gains realized were quickly washed away and buyers only came off the sidelines to plug pressing holes.

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