User Panel
Some insight from a local plywood producer:
https://frereslumber.com/blog/may-market-report-wood-products-prices-and-shortages/ What was once considered a widely available commodity is now experiencing a nation-wide shortage. Sorry to pass on the bad news to consumers, but price increases show no signs of abating in the short-term. The Random Lengths Lumber Composite price rose 5% last week, representing a 332% increase year over year, to a record high of $1395. OSB prices rose 1.7% in the North Central Region to a record high of $1190/msf, a 367% increase year over year. Plywood is now being used as an OSB substitute as OSB trades at higher levels than plywood in the marketplace. Traditionally plywood is considered a higher value product commanding price premiums to OSB for industrial usage. View Quote Our single largest obstacle is employment. Our current commitment to increasing employment includes a new 10% across the board wage and salary increase for all employees, more than half of which reside locally — this equates to a $2.5 million increase in wages annually. We are also investing heavily into advanced robotics to make positions less arduous and repetitive. We currently have nine robots in production today but have another four robots on-order for implementation throughout our facilities. We are currently at 60% of our historical production levels. We would like to have a stable enough workforce that will allow us to run overtime production as well as add shifts throughout our facilities. We still have a referral bonus in place. View Quote |
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In the Commodity world, the cure for high prices is high prices.
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Quoted: Some insight from a local plywood producer: https://frereslumber.com/blog/may-market-report-wood-products-prices-and-shortages/ View Quote View All Quotes View All Quotes Quoted: Some insight from a local plywood producer: https://frereslumber.com/blog/may-market-report-wood-products-prices-and-shortages/ What was once considered a widely available commodity is now experiencing a nation-wide shortage. Sorry to pass on the bad news to consumers, but price increases show no signs of abating in the short-term. The Random Lengths Lumber Composite price rose 5% last week, representing a 332% increase year over year, to a record high of $1395. OSB prices rose 1.7% in the North Central Region to a record high of $1190/msf, a 367% increase year over year. Plywood is now being used as an OSB substitute as OSB trades at higher levels than plywood in the marketplace. Traditionally plywood is considered a higher value product commanding price premiums to OSB for industrial usage. Our single largest obstacle is employment. Our current commitment to increasing employment includes a new 10% across the board wage and salary increase for all employees, more than half of which reside locally — this equates to a $2.5 million increase in wages annually. We are also investing heavily into advanced robotics to make positions less arduous and repetitive. We currently have nine robots in production today but have another four robots on-order for implementation throughout our facilities. We are currently at 60% of our historical production levels. We would like to have a stable enough workforce that will allow us to run overtime production as well as add shifts throughout our facilities. We still have a referral bonus in place. Sounds like they need to start being creative like offering free day care so you can lure in women workers. You can literally pay some one $50,000 a year to operate the inhouse day care. |
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Quoted: It's a "next year" project now. That's what I'm doing. Punting. Not worth it now. View Quote View All Quotes View All Quotes Quoted: Quoted: I hope it goes back to last years prices. I really want to build my deck this summer. It's a "next year" project now. That's what I'm doing. Punting. Not worth it now. Shit. I just postponed my freaking house build! I was going to dig the basement next week. Ran the numbers and given the roughly $40.00 increase in sq' pricing it was going to cost me an additional $160,000.00 just in materials. Never mind what the pole barn was going to cost. Fucking sucks! |
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Quoted: Just a guess...the lumber situation hasn't improved, but new construction buyers are walking away from the table when they see the time and cost estimate for that house they want...especially given the probability that the trend line resumes it's march upwards when Biden's work force continues to prefer being paid for napping on the couch to sweating in a loud and dangerous sawmill. It's happening a lot here. We have multiple friends who've shelved projects. View Quote We have friends building a house at the end of our road. Their initial construction loan had a one year time frame to completion. A few months back they had to take out a loan from his parents just to keep things moving as they finished up the framing and roofing. Now they have just stopped, they are out of money. House is framed, roofed, and OSB exterior sheeting up, work completely stopped. |
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Quoted: We have friends building a house at the end of our road. Their initial construction loan had a one year time frame to completion. A few months back they had to take out a loan from his parents just to keep things moving as they finished up the framing and roofing. Now they have just stopped, they are out of money. House is framed, roofed, and OSB exterior sheeting up, work completely stopped. View Quote View All Quotes View All Quotes Quoted: Quoted: Just a guess...the lumber situation hasn't improved, but new construction buyers are walking away from the table when they see the time and cost estimate for that house they want...especially given the probability that the trend line resumes it's march upwards when Biden's work force continues to prefer being paid for napping on the couch to sweating in a loud and dangerous sawmill. It's happening a lot here. We have multiple friends who've shelved projects. We have friends building a house at the end of our road. Their initial construction loan had a one year time frame to completion. A few months back they had to take out a loan from his parents just to keep things moving as they finished up the framing and roofing. Now they have just stopped, they are out of money. House is framed, roofed, and OSB exterior sheeting up, work completely stopped. sounds like they need to learn how to be carpenters. |
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Quoted: I can't imagine what the guy building his house in a lot behind us is overpaying for lumber. Housing prices have already reached max retardation here and this guy began building in Feb/March. I'm willing to bet hes paying 1.5M or more for something that would have listed for 600-750k less than 12 months ago. View Quote Whats that saying, a fool and his money. People overpaying for these shacks are going to be in for a rude awakening when the owe 4 times what their house is worth after the value goes down. |
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won't drop too far, demand is too high. too many postponed projects which will go active again as soon as you get down in the 1000-1200 range
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Quoted: The mills have no incentive to increase production at the moment because they have fat margins, as those margins shrink, they will have to increase production, as production increases, margins will shrink more, then keep shrinking until homeostasis is reached. I highly doubt the mills are managed by people who posses the skill to understand how commodity demand curves work and how this is going to bite them in the ass. View Quote I would consider this a prime reason to increase production to the absolute maximum. Make hay while the sun shines is an old saying for a reason. I also suspect the owners of the mills understand that during a time of high demand, that is the time to maximize production & profits. |
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Quoted: I would consider this a prime reason to increase production to the absolute maximum. Make hay while the sun shines is an old saying for a reason. I also suspect the owners of the mills understand that during a time of high demand, that is the time to maximize production & profits. View Quote View All Quotes View All Quotes Quoted: Quoted: The mills have no incentive to increase production at the moment because they have fat margins, as those margins shrink, they will have to increase production, as production increases, margins will shrink more, then keep shrinking until homeostasis is reached. I highly doubt the mills are managed by people who posses the skill to understand how commodity demand curves work and how this is going to bite them in the ass. I would consider this a prime reason to increase production to the absolute maximum. Make hay while the sun shines is an old saying for a reason. I also suspect the owners of the mills understand that during a time of high demand, that is the time to maximize production & profits. That should tell you somthing. They know it's not going to last. Because if you all of a sudden can 4x your margins, you'd definitely be able to pay big wages. Somthing isn't adding up here. |
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Quoted: Sounds like they need to start being creative like offering free day care so you can lure in women workers. You can literally pay some one $50,000 a year to operate the inhouse day care. View Quote View All Quotes View All Quotes Quoted: Quoted: Some insight from a local plywood producer: https://frereslumber.com/blog/may-market-report-wood-products-prices-and-shortages/ What was once considered a widely available commodity is now experiencing a nation-wide shortage. Sorry to pass on the bad news to consumers, but price increases show no signs of abating in the short-term. The Random Lengths Lumber Composite price rose 5% last week, representing a 332% increase year over year, to a record high of $1395. OSB prices rose 1.7% in the North Central Region to a record high of $1190/msf, a 367% increase year over year. Plywood is now being used as an OSB substitute as OSB trades at higher levels than plywood in the marketplace. Traditionally plywood is considered a higher value product commanding price premiums to OSB for industrial usage. Our single largest obstacle is employment. Our current commitment to increasing employment includes a new 10% across the board wage and salary increase for all employees, more than half of which reside locally — this equates to a $2.5 million increase in wages annually. We are also investing heavily into advanced robotics to make positions less arduous and repetitive. We currently have nine robots in production today but have another four robots on-order for implementation throughout our facilities. We are currently at 60% of our historical production levels. We would like to have a stable enough workforce that will allow us to run overtime production as well as add shifts throughout our facilities. We still have a referral bonus in place. Sounds like they need to start being creative like offering free day care so you can lure in women workers. You can literally pay some one $50,000 a year to operate the inhouse day care. For some reason every industry outside of Tech can't figure this out. at some point offering onsite daycare, free meals, hell even laundry service would be cheaper than paying several million annually in wages. |
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Quoted: I don't know about your AO but , around here mills ain't paying shit for logs and they only take what they want. Try sending a mill a load of shit logs and see what you get paid for them. It's not the grower that's getting rich View Quote before this the highest I ever saw was 1400 per 1000 board feet last week I sent in a truck that they only deducted 85 board feet off of. AND they payed me 2450 for 1000 board feet. Life is good. |
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It is not just lumber thats hurting.
FIL is a plaster guy in New England says the rock supply for his work is stupid right now. |
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Quoted: Sounds like they need to start being creative like offering free day care so you can lure in women workers. You can literally pay some one $50,000 a year to operate the inhouse day care. View Quote In my younger days I worked at a saw mill. I feel confident in saying the majority of women would not choose to work there. It is an extremely demanding physical job in an unpleasant environment. |
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logs and fresh lumber are perishable products and mills don't want them laying around too long. Mill owners will lose money by dragging their feet on purpose
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Quoted: Just a guess...the lumber situation hasn't improved, but new construction buyers are walking away from the table when they see the time and cost estimate for that house they want...especially given the probability that the trend line resumes it's march upwards when Biden's work force continues to prefer being paid for napping on the couch to sweating in a loud and dangerous sawmill. It's happening a lot here. We have multiple friends who've shelved projects. View Quote Agreed. I’ve got 3 plans drawing and my feelings are 2 of the 3 will not build in the current market conditions. They have already both stated they will wait for lumber prices to come down. Problem is, how far will lumber fall and we are seeing cost increases across the board that will probably offset any savings in lumber prices. |
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Quoted: Any ideas on the effect of rising materials/construction costs on land prices? Seems if people are being priced out of new construction, land isn't as attractive right now. Of course that's the short-term view. View Quote Land prices here are skyrocketing. 1 acre lots that were selling for 75-80k about 2 years ago have more than doubled. Salesman in 1 development told me last week they’re opening up 2 more units of 110 lots and they will be 169 - 209k. |
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Quoted: It is not just lumber thats hurting. FIL is a plaster guy in New England says the rock supply for his work is stupid right now. View Quote One of our clients is a fairly high volume builder in the upper end of the market. A few weeks ago we called him to discuss delays on our end due to supply chain shortages and longer lead times on custom materials....this week he called us to say that the shortages and delays are catching up to all his trades now and their overall production is slowing down. Luckily they are self funding so it just means trudging through the year and likely not meeting their projections...but even with the price increases people are buying the houses prior to completion. |
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Quoted: We happened to pass this the other day. https://www.ar15.com/media/mediaFiles/260794/79954304-6092-4907-8F05-11DAC281C20B-1940921.jpg View Quote I buy material from around the world. Europe, Australia, South America , Canada and the US. The exchange rate is one thing causing lumber to rise as is fuel prices |
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I call BS. The wood I had in my Home Depot shopping cart went up $10.27 overnight....literally overnight.
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Was in Home Depot 2 days ago. 2x4 was 9.75. Guy said they expect the prices to go higher next week. I need about 6 to close out a window. I’ll wait f that
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Quoted: I buy material from around the world. Europe, Australia, South America , Canada and the US. The exchange rate is one thing causing lumber to rise as is fuel prices View Quote View All Quotes View All Quotes Quoted: Quoted: We happened to pass this the other day. https://www.ar15.com/media/mediaFiles/260794/79954304-6092-4907-8F05-11DAC281C20B-1940921.jpg I buy material from around the world. Europe, Australia, South America , Canada and the US. The exchange rate is one thing causing lumber to rise as is fuel prices it's 1.21 USD to buy 1 euro so that's only a 21% premium, then what ever the transportation costs are not sure. But when a SYP 2x4x8 goes from $1.94 pre pandemic to $8 post, I can definitely see getting Spruce and Fir 2x4s from Germany being a hell of a lot cheaper. What's going to happen is that if the US mills don't get off their asses they are gonna get under big by the Europeans. |
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Still rolling over.....down roughly 18% from the top.
Attached File I wouldn't be surprised if it found resistance between 1300-1400 on the short term. |
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Quoted: Still rolling over.....down roughly 18% from the top. https://www.ar15.com/media/mediaFiles/277411/lumber_5_14_PNG-1941796.JPG I wouldn't be surprised if it found resistance between 1300-1400 on the short term. View Quote I'd bet money that we won't return to pre Covid prices. The mills will start to cut production to keep prices up when demand falls |
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Quoted: I'd bet money that we won't return to pre Covid prices. The mills will start to cut production to keep prices up when demand falls View Quote View All Quotes View All Quotes Quoted: Quoted: Still rolling over.....down roughly 18% from the top. https://www.ar15.com/media/mediaFiles/277411/lumber_5_14_PNG-1941796.JPG I wouldn't be surprised if it found resistance between 1300-1400 on the short term. I'd bet money that we won't return to pre Covid prices. The mills will start to cut production to keep prices up when demand falls demand will keep falling until there is equilibrium on the price curve. We will soon see how elastic it all is it always reverts back, the reason is that SYP timber prices stay flat, at some point if the mills keep messing around, new mills will be made to undercut the old mills. |
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Just got this in an email from one of my vendors
All , Here is a quick update from Random lengths Lumber Report today . Unfortunately , lumber still going up this week . RANDOM LENGTHS LUMBER COMPOSITE REPORT ( all the species , all the sizes ) PLUs $81 This week Last Week 1 Year Ago $1495 $1414 $382 EASTERN SPRUCE COMPOSITE PRICE ( all the dimensions and lengths ) Plus $ 70 This Week Last Week 1 Year ago $1663 $1593 $403 |
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Quoted: Just got this in an email from one of my vendors All , Here is a quick update from Random lengths Lumber Report today . Unfortunately , lumber still going up this week . RANDOM LENGTHS LUMBER COMPOSITE REPORT ( all the species , all the sizes ) PLUs $81 This week Last Week 1 Year Ago $1495 $1414 $382 EASTERN SPRUCE COMPOSITE PRICE ( all the dimensions and lengths ) Plus $ 70 This Week Last Week 1 Year ago $1663 $1593 $403 View Quote yep it's parabolic, same thing happened to oil in 2007. |
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Quoted: About damned time. Our cost to build went up $40/S.F. over the last 12 months. Just got a price increase in drywall, and there's another one coming June 1. View Quote I budgeted $1500 for a way overdue covered deck before the BS hit thinking that amount would more than cover. Got it 90% finished two months ago. I'm almost at $3000 now. |
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Quoted: Still rolling over.....down roughly 18% from the top. https://www.ar15.com/media/mediaFiles/277411/lumber_5_14_PNG-1941796.JPG I wouldn't be surprised if it found resistance between 1300-1400 on the short term. View Quote Nice! |
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Quoted: Quoted: Still rolling over.....down roughly 18% from the top. https://www.ar15.com/media/mediaFiles/277411/lumber_5_14_PNG-1941796.JPG I wouldn't be surprised if it found resistance between 1300-1400 on the short term. Nice! yep.....ultimately when it comes down to earth is going to depend on this Hurricane season. I am not expecting a giant drop until going into the winter. |
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Quoted: Makes me wonder what standard marine grade exterior plywood? View Quote View All Quotes View All Quotes Quoted: Quoted: We will see. Paid $38 3 weeks ago for 7/16 OSB for a home. Yesterday it was at $52 and my salesman said they expected close to $60 sheet within the next week or so. Makes me wonder what standard marine grade exterior plywood? |
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Quoted: yep.....ultimately when it comes down to earth is going to depend on this Hurricane season. I am not expecting a giant drop until going into the winter. View Quote I agree with that. I'm still buying for my weekly needs but I've got brokers looking for substantial buys in the 4th and 1st quarter on 22 |
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Quoted: Here it is currently $65 for CDX and $63 for OSB. Marine plywood has always been obscene, and we don't sell much anyway - but for some time now, the prices have not moved - last I looked it was still at $73 for 1/2" and $75 for 3/4". And that has been the price since before the other prices started skyrocketing. I was actually surprised that it wasn't going up as well. View Quote View All Quotes View All Quotes Quoted: Quoted: Quoted: We will see. Paid $38 3 weeks ago for 7/16 OSB for a home. Yesterday it was at $52 and my salesman said they expected close to $60 sheet within the next week or so. Makes me wonder what standard marine grade exterior plywood? all the marine ply to be used for the next year probably has already been milled. |
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Quoted: I agree with that. I'm still buying for my weekly needs but I've got brokers looking for substantial buys in the 4th and 1st quarter on 22 View Quote View All Quotes View All Quotes Quoted: Quoted: yep.....ultimately when it comes down to earth is going to depend on this Hurricane season. I am not expecting a giant drop until going into the winter. I agree with that. I'm still buying for my weekly needs but I've got brokers looking for substantial buys in the 4th and 1st quarter on 22 I am willing to bet they are suspecting a drop in price by then |
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Quoted: Difference though is oil costs stupid to store if it dont sell. Stockpiling dried wrapped lumber is alot less costly for the producers. View Quote View All Quotes View All Quotes Quoted: Quoted: yep it's parabolic, same thing happened to oil in 2007. Difference though is oil costs stupid to store if it dont sell. Stockpiling dried wrapped lumber is alot less costly for the producers. it really depends....because I don't think anyone was taking delivery on the futures contracts back in 2007. My dad worked for a company that moved 18% of the nations energy through their facility, pipeline, tank farm, caverns, and my good buddy works in their futures trading department. It got expensive if you actually wanted your own name on the oil barrels, i.e. you had your own oil, but if you didn't mind getting what ever oil was in storage then it wasn't that pricey all things being relative. |
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Quoted: Quoted: "Correlation is weakening." Seems pretty damn correlated given what happened yesterday. What happened yesterday? stocks went down and lumber went down, but lumber still capitulated and is still heading down while stonks are going up. I would appreciate if GD stops questioning my quant models. |
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Quoted: I can't imagine what the guy building his house in a lot behind us is overpaying for lumber. Housing prices have already reached max retardation here and this guy began building in Feb/March. I'm willing to bet hes paying 1.5M or more for something that would have listed for 600-750k less than 12 months ago. View Quote How does that reconcile in the end ?, price stabilizes and retreats from the highs. You have more $$ in your house than what it's worth. Who gets left holding the bag ? Looks like a bubble in the making. |
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Quoted: That's twice the number of data points GD usually needs before judging something. View Quote View All Quotes View All Quotes Quoted: Quoted: Two data points makes a trend , on that chart? That's twice the number of data points GD usually needs before judging something. LOL |
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