Lumber prices continued to rise through the first quarter of 2018, coming off last year’s strong finish. The ENR 20-city average price for the most common varieties of 2x4 lumber is up 10.4% over the year-ago period, while IHS Markit’s most recent forecast predicts a 4.5% increase for softwood lumber in 2018. That price hike is a marked shift from the industry forecaster’s outlook released in the fourth quarter of 2017, which called for a 1.8% decrease in lumber after a double-digit spike last year.
“Lumber continues to surprise me [with] the continued price climb,” says IHS Markit economist Thomas McCartin, who attributes this largely to the downturn in the Canadian lumber supply coming into the U.S. At the end of last year, the U.S. Commerce Dept. put in place a new tariff on Canadian lumber coming into the U.S., at a rate of 20.83% for the majority of importing companies.