CHICAGO - The price of lumber in America has more than doubled over the last year and continues to spike, somewhat erratically, industry insiders say.
It's causing many Americans to be priced out of buying new homes, and causing builders to cancel existing contracts.
"A year ago, the same thing you're standing on was $14 a sheet," said Patrick Franz, owner of Clairmont LTD in the Chicago suburbs, pointing to a sheet of plywood he says would now cost him $55 or $65 at the lumber yard. "One of our lumber yards nearby has said, 'this is all we have and we don't know when we're getting more.' The example is: we said we need 55 sheets of plywood and they said, you can have twenty."
"I’ve talked to a number of builder friends of mine and for the house they built last year, the lumber prices were $30,000 less than what they are today," Franz said.
One factor is increased demand for both new and remodeled homes--the result of pandemic-weary Americans wanting more space, along with features like home offices, home gyms, and more space for families to spread as they work or attend school remotely.
"COVID changed the complexion of a lot of building in that--in an odd way--it ramped up demand sooner than we would have felt it," Franz said.
But the president of the NAHB, Jerry Howard, says there are other factors driving the lumber shortage and sky-high prices, some of which remain a mystery.
At the start of the pandemic, many timber companies were forced to shut down their operations, which logically caused an initial drop in lumber supply.
"But as things have opened up, the supply of lumber and the cost of lumber have not gone back to their normal state," Howard said. "We don't understand it. We've asked [the lumber industry] to explain it. We can't get answers. All we get are unhappy home buyers and unhappy potential home buyers."
Last year, Howard and the NAHB convinced Trump-appointed Commerce Secretary Wilbur Ross to call a meeting with all the key players in the timber industry--from the timber companies to the saw mills to the transporters--but Howard says that meeting fizzled.
"I personally believe that some of the players in the timber industry didn't want to come to the table," he said. "And obviously you can't force people to sit down and negotiate and talk like gentlemen. They didn't want to do it, nothing you can do about it."
Howard is hoping for a better result under current Commerce Secretary Gina Raimondo. "We’re gonna leave no stone unturned until somebody can give us a reason for this incredible, unprecedented price increase," he said.
Illinois Sen. Tammy Duckworth said she is working to address the factors that caused the shortage.
"Families across Illinois hoping to build or renovate a home over the past year faced a perfect storm that dramatically increased costs," Senator Duckworth said. "The COVID-19 pandemic, global warming and Donald Trump’s misdirected trade wars all contributed to a shortage in lumber supply that spiked prices across the nation. As lumber prices stabilize and return to pre-pandemic levels, I’m working to address the underlying factors that caused this volatility: making sure we’re prepared for future pandemics, tackling climate change and implementing commonsense trade policies."