Freedonia experts have noted – repeatedly – that softwood lumber prices have remain stubbornly high in the COVID era, even as lumber mills reopen and expand production. While these high prices are good for lumber producers, they have affected the construction industry, causing new home prices to rise and consumers to put off DIY projects – potentially affecting the US economy’s recovery from the COVID-19 pandemic.
Those expecting relief from high lumber prices may have to wait, though, due to Hurricane Laura. Among the destruction caused by the landfall of this storm were thousands of acres of forest land, destroying millions of board feet of potential lumber. The effects of this storm on Louisiana’s lumber industry were multifold. In addition to the loss of trees destroyed by Hurricane Laura:
- mills in and around the state suffered damaged, affecting immediate production of lumber
- recently harvested logs were destroyed due to high winds or water, further straining supplies of harvested timber
- equipment that could have been used to salvage downed logs was instead used for other purposes, such as clearing debris from roads
- demand for lumber and other engineered wood products (such as plywood) surged immediately before and after the storm as home and business owners sought to protect or rebuild structures in the storm’s path
Freedonia experts will continue to closely watch the lumber market, charting the effect of Hurricane Laura – and other severe weather events – on lumber prices and the construction market as a whole.
For more information and discussion of opportunities, see The Freedonia Group’s extensive collection of off-the-shelf research, particularly in the Construction and Building Products. Freedonia also offers an expanding catalog of COVID-19 Economic Impact reports, which highlight how various industries are responding to the current crisis with a comparison to recent recessions. Freedonia Custom Research is also available for questions requiring tailored market intelligence.