August 2, 2022

Ag Economy

Timber and Forest Products Industry Snapshot

Lumber

  • Housing starts remain strong at 1.5 million units, annualized in May, although this is down from 1.8 million units the previous month. Rising interest rates are expected to drag on the housing market, although there is still significant pent-up demand from consumers for homes. 
  • Lumber prices continue to experience volatility. Prices are down approximately 50% from the prior quarter-end, but this may boost volume as some buyers have been sidelined by high prices. Despite recent declines, lumber prices remain well-above long-term averages.1  
  • Production capacity growth is likely to be limited as labor and transportation constraints will continue to hamper growth. 

Logging

  • Rising fuel and labor costs have impacted truckers and loggers, limiting their profitability despite strong demand for their services.  

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