Lumber and plywood prices typically rise in the spring and drop by the end of fall, by about five percent. This year look for not a decline but a leveling off. Prices will remain high for another two or three years, then drop back to more normal levels.
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.
While prices have come down a little bit on things like 8-foot 2 by 4s, essential building materials like plywood remain pricy. A recent report shows lumber had extended losses to trade below $800-hundred dollars per thousand board feet, the lowest level since January. Demand is slowing while sawmills invest to increase output.
“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.
While researching we ran into the query “When will lumber prices go back down?”.
Lumber and plywood prices have jumped through the roof in the U. S. Building materials prices will retreat in 2022, returning to pre-pandemic levels by 2023.
Why are plywood prices rising?
With the increase in building, the price for lumber goes up. This is a simple supply and demand situation that we are currently experiencing. Until the supply starts to catch up with the demand, people will continue to pay very high prices for their lumber. This is a factor that will apply to all types of lumber, including plywood.
Why are plywood prices skyrocketing?
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. Wood demand shot up in the summer of pandemic. Many homeowners were stuck at home, unable to vacation.
You might be wondering “Why did plywood price increase?”
The answer was the factors for the increased prices of plywood are the same as for lumber, Church said.