Lumber and plywood prices are so high now because of the short-run dynamics of demand and supply. Wood demand shot up in the summer of pandemic. Many homeowners were stuck at home, unable to vacation.
Wood is fairly abundant, in North America, especially in the southern forests. Modern mills are very efficient at turning logs into 2x4s and sheets of plywood. Lumber and plywood prices are so high now because of the short-run dynamics of demand and supply.
A frequent inquiry we ran across in our research was “Why is lumber so absurdly expensive?”.
While hardwoods require less upkeep, they do tend to be more expensive on area in question. With so many options for patterns and finishes it’s easy to see why wood board siding is a popular.
Another frequently asked question is “Why wood is insanely expensive Right Now?”.
The price of wood has risen dramatically over the last year “The average lumber historically has been between $300 and $400 per thousand board feet. Right now, it’s over a $1,000. I see it in the $700 or $800 price range by summer.”.
There are three primary reasons why lumber prices were much higher than normal. There are fewer lumber mills. The first reason has developed over many years: a consolidation in the number of sawmills to refine the raw product. In fact, employment at sawmills is down 30% from 20 years ago. Sawmills are capital intensive endeavors.
What is the average price of plywood?
The price of plywood varies significantly depending on the size and thickness. A 4X8 sheet can range from $7 to as much as $60. As an example, for a 1/4 inches thick board, you may pay $8, while an 11/32 inches thick panel will cost around $18. You can get a better idea through our chart below.
You could be wondering “How much does plywood cost per square foot?”
Your price could vary depending on how much the roofing company charges for labor, but generally you can expect to spend between $70 to $100 for each sheet of plywood. A 4 x 8 sheet of plywood covers about 32 square feet of roof area—and the average roof measures about 3,000 square feet.
Will plywood prices drop soon?
“Looking ahead, hope abounds that construction starts will soon begin a more robust rebound forecast in the first quarter. Plywood prices will rise 39.8% this year, says IHS Markit.
Since the last time we touched on the subject in early September of 2020, the cost of lumber has already started to decrease substantially. It has dropped from $948 per thousand board feet in September to now $565 per thousand board feet in early November.
Plywood and lumber prices overall experienced an extreme spike in the early part of 2021, peaking in early May and dropping quickly to levels approaching but not yet matching pre-pandemic prices in July.