The recent run on lumber prices has put big smiles on the faces of sawmill operators and lumber traders.
Mill prices for all lumber species in North America have been trending higher since preliminary U.S. import duties began in February 2017, and especially after permanent duties (averaging 20.2 per cent) started in late December. While the implementation of U.S. import duties on Canadian lumber was expected to push prices up somewhat, the interaction of several factors — the seasonal impact of summer forest fires in 2017, severe winter weather followed by railcar shortages in 2018, and continued strong demand in export markets — has created an almost perfect storm.
As a result, record-high lumber prices have been achieved in June for all species before deducting Canadian import duties on U.S. shipments. In addition, record prices have been seen in such other markets as Japan. One of the major exceptions, however, has been in studs: U.S. prices have languished in comparison to dimension lumber but they also hit record levels.