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>Futures tumbled to US$974.80 per 1,000 board feet on the Chicago Mercantile Exchange on Friday, heading for a sixth straight decline. For comparison, it was $

by sb057 5y ago

>Futures tumbled to US$974.80 per 1,000 board feet on the Chicago Mercantile Exchange on Friday, heading for a sixth straight decline. For comparison, it was $403.60 at the start of 2020: https://tradingeconomics.com/commodity/lumber https://tradingeconomics.com/commodity/lumber

thematrixturtle 5y ago
This. Lumber prices are down 30% since March 1st, but still 250% up since COVID.
- EVa5I7bHFq9mnYK 5y ago
  Isn't it 150%? Percentages are hard.
  - thematrixturtle 5y ago
    If pre-covid index is 100, the current price is 250, which can be expressed as either 250% of the previous price or a 150% increase in price (up by 150%). English is hard.
sandworm101 5y ago
Ya, the price bubble hasnt really burst. It just deflated a little but remains a bubble.
- after_care 5y ago
  Why do you say lumber is a bubble? It seems to me all of the lumber being produced is being used, and lumber is a limited and valuable natural resource. I don't see how lumber supply suddenly increases or lumber demand suddenly decreases.
  - stjohnswarts 5y ago
    the price is a bubble not the volume. As supply goes up then the price will drop as demand is staying the same or dropping a bit depending on who you ask.
  - pmichaud 5y ago
    On the demand side there is a spike basically from low interest rates plus everyone trying to move into a house over the past couple years. But that’s starting to chill out as the house prices got pretty prohibitive and interest rates are looking to climb. Plus there’s the speculative market which responded to rising prices by buying/raising the price, and will at some point, maybe right now, swoop back down in line as signs point to a downturn and speculators bail. You’re right though that it’s hard to expand the throughput of the supply side since even doubling, say, the number of planted trees won’t pay off for at least 20 years in the case of fast growing trees like poplar, and longer for harder woods.
  - positr0n 5y ago
    > lumber is a limited and valuable natural resource I assume this is still true, but a year ago when I unfortunately had to start a large lumber project the stumpage fee, aka the price a tree owner gets when they sell their tree to be logged, was at all time lows. The entire price increase was at the mills due to - supply dipped because everyone thought the economy was going die and preemptively shut down mills in 2020 but actually the opposite happened - demand soared as everyone wanted to build houses or do renovations - lastly, minor labor shortages and covid outbreak induced stoppages

by sb057 5y ago

thematrixturtle 5y ago

This. Lumber prices are down 30% since March 1st, but still 250% up since COVID.

EVa5I7bHFq9mnYK 5y ago
Isn't it 150%? Percentages are hard.
- thematrixturtle 5y ago
  If pre-covid index is 100, the current price is 250, which can be expressed as either 250% of the previous price or a 150% increase in price (up by 150%). English is hard.

sandworm101 5y ago

Ya, the price bubble hasnt really burst. It just deflated a little but remains a bubble.

after_care 5y ago
Why do you say lumber is a bubble? It seems to me all of the lumber being produced is being used, and lumber is a limited and valuable natural resource. I don't see how lumber supply suddenly increases or lumber demand suddenly decreases.
- stjohnswarts 5y ago
  the price is a bubble not the volume. As supply goes up then the price will drop as demand is staying the same or dropping a bit depending on who you ask.
- pmichaud 5y ago
  On the demand side there is a spike basically from low interest rates plus everyone trying to move into a house over the past couple years. But that’s starting to chill out as the house prices got pretty prohibitive and interest rates are looking to climb. Plus there’s the speculative market which responded to rising prices by buying/raising the price, and will at some point, maybe right now, swoop back down in line as signs point to a downturn and speculators bail. You’re right though that it’s hard to expand the throughput of the supply side since even doubling, say, the number of planted trees won’t pay off for at least 20 years in the case of fast growing trees like poplar, and longer for harder woods.
- positr0n 5y ago
  > lumber is a limited and valuable natural resource I assume this is still true, but a year ago when I unfortunately had to start a large lumber project the stumpage fee, aka the price a tree owner gets when they sell their tree to be logged, was at all time lows. The entire price increase was at the mills due to - supply dipped because everyone thought the economy was going die and preemptively shut down mills in 2020 but actually the opposite happened - demand soared as everyone wanted to build houses or do renovations - lastly, minor labor shortages and covid outbreak induced stoppages