The price of lumber in the Chicago futures market is at an all-time high. The demand for lumber is very strong in the United States, as sawmills struggle to supply. The coronavirus is still involved.
Wood is the raw material that has benefited the most from the coronavirus this year. The price of a thousand board feet, the equivalent of 2.36 cubic meters, has more than doubled since January on the Chicago Stock Exchange. It exceeds 800 dollars, an absolute record.
Many Americans, kept at home during the Covid-19 epidemic, have started renovating their homes, their terraces, their fences. Knowing that homes are mostly made of wood in the United States, the demand for boards, in particular softwood, has increased sharply, while sawmills did not anticipate this boom. They had gone into maintenance and lived on their stocks. Then the factories ran out of manpower because of the coronavirus.
Lack of labor in sawmills
Today, while the construction boom continues despite the recession in the United States, unprecedented – but it must be said that the interest rates are very low -, the sawmills are unable to provide, because only half of the employees have returned to work with the implementation of physical distancing measures.
These soaring lumber prices are not helping North American logging companies that much. Even though their stock market share has jumped, lumber only represents a fifth of their market. The rest of the wood cut goes to the pulp mills, which are doing very badly due to the collapse of the paper advertising market.
Suppliers write to Donald Trump
As for the suppliers of building materials in the United States, they complain about this inflation of sawnwood. They have just written a letter to the American president asking him to waive the 20% tax imposed two years ago on softwoods imported from Canada. Donald Trump claimed that this wood benefited from subsidies from Ottawa, an argument that the World Trade Organization (WTO) rejected at the end of last month.
In the meantime, wood exporters from Europe and Russia are benefiting from the air demand of the American market.
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