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Message
re: Anyone follow lumber prices?
Posted on 2/3/21 at 5:10 am to BornCritic
Posted on 2/3/21 at 5:10 am to BornCritic
quote:
Lumber prices have made me a believer in the Great Reset. They're trying to make us lose our minds
Nah. It's simple supply side economics. For decades, Canada operated their forests as a jobs program. They harvested at a way higher rate than they grow back. Of course the forests are 90% owned by the government so it's no surprise that they were grossly mismanaged. The government even built the CN Railroad all throughout the remote timber belt of interior Canada. And subsidized flat car rates into the US. So free timber and nearly free transportation. And low interest government loans to build sawmills.
For decades the Canadians could deliver a 2x6 to Memphis TN cheaper than a pine sawmill in Mississippi could. So, not enough pine sawmills were built in the Southeast.
Now, I am not so sad to report, that Canada is basically out of Timber. And they're closing several sawmills every year. Plus a more environmentally friendly liberal government is finally cutting back on their unsustainable harvest practices. So their lumber production is now in a significant decline.
The Southeast USA has been growing three times as much pine timber as we have been harvesting. We don't have nearly enough sawmills. So the business is suddenly very profitable here
There's a rush to catch up. We are building about 4 or 5 new modern pine sawmills per year in the SE over the past 5 years. But it will take another 10 years to bring things back into balance. Until then, lumber prices will be subject to seasonal shortages and lots of volatility.
Posted on 2/3/21 at 9:56 am to No Colors
quote:
No Colors
Thank you for the very informative post.
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