15.01.202618:03:21UTC+00Lumber Climbs to Nearly 3-Month Highs

Lumber futures have surged above $600 per thousand board feet, marking the highest point in nearly three months. This surge is driven by an encouraging demand outlook paired with a constrained supply landscape in North America. Demand projections are on the rise following a significant drop in 30-year mortgage rates to 6.06% as of January 15th—the lowest they've been in over three years. This decline in rates is stimulating both purchasing and refinancing activities, prompting builders to replenish their stockpiles in anticipation of a robust spring construction season. On the supply side, pressures are mounting due to increased US duties on Canadian softwood, which have elevated landed costs and motivated buyers to expedite orders to hedge against the risk of additional tariffs. These policy dynamics are exacerbating the situation of chronically reduced harvests and the ongoing shutdowns and operational slowdowns at mills throughout Canada, thereby diminishing the overall availability of lumber. Concurrently, data from the US Producer Price Index and various industry surveys indicate that construction input costs remain high, suggesting that tariff-related cost pressures are permeating through the supply chain.