Archinect - News

Lumber prices expected to hike as Canadian wildfires rage on

2023-07-18T13:06:00-04:00

Canadian wildfire smoke continues to blow over much of the U.S., raising air pollution to harmful levels for construction workers. Now, the impact of the fires is likely to raise U.S. lumber prices, too.

As reported by Construction Dive, Canada’s devastating wildfire season, which has been felt across North America through declined air quality, has impacted the largest amount of land ever recorded in a single year. As a result, lumber prices are expected to rise as Canada supplies approximately 80% of U.S. softwood lumber imports. However, it is too early to know how much of the affected areas include harvestable timber, as well as how much will be damaged in the coming months.

The Canadian provinces of Alberta and Quebec have been hit the hardest by the fires so far, with around 3.8 million and 3.5 million acres burnt, respectively. Together, they account for 44% of Canada’s annual softwood lumber shipments and 45% of total production. Canada’s weather conditions are expected to fuel more wildfires throughout the summer, which paints a grim outlook for lumber prices.

Covid-era bubbles and today's inflation driving heavy volatility of lumber prices

2022-08-22T10:41:00-04:00

Since the COVID-19 pandemic began, multifamily developers and builders have had their work cut out for them as they try to budget for their lumber needs. After months of wild fluctuations, lumber futures fell to their lowest level in a year earlier this month, according to lumber price data from NASDAQ. They have since reversed course, and currently stand at just under $600.

As reported by Multifamily Dive, two pandemic-induced bubbles, in which lumber futures rose to record highs in the thousands of dollars, popped, dropping to below $500. The producer price index, a measure of the average changes in prices received by producers, for softwood lumber fell 22.6% in June of this year and 35% overall between March and July 2022. Measured by the U.S. Bureau of Statistics, prices for the material have never exhibited more than 10% volatility in a given month until early 2020, when lumber costs jumped 20%. Since then, the price volatility for lumber, at its higher points, has ranged from 25% to 30%.

It is believed that one of the reasons behind these recent decreased lumber prices is the impact of inflation on industries that depend on lumber. Specifically, the housing industry has been hit by higher interest rates and costs, which has affected the demand for lumber.

Detail-loving architects can turn timber from a material into a career

2022-06-01T10:24:00-04:00

It’s been a rough couple of years for timber. As we have previously reported, lumber prices across the United States saw a 90% increase in May 2021 on the previous 12 months, adding an extra $36,000 onto the cost of constructing a new home. In a relief for clients and contractors alike, that record high was followed by a record-breaking 40% decline in June 2021, although lumber prices have continued their wide fluctuation into 2022.

Most analysts have laid the blame for this turbulent lumber market on short-term factors. These include pandemic-era labor shortages and supply chain shutdowns, potential looming tariffs imposed by the U.S. on Canadian lumber imports, and even the 2021 Canadian truckers’ strikes.

However, as we outlined in February, these short-term contributors are further compounded by more fundamental long-term impacts. Canadian forests, for example, face ongoing battles with invasive species and forest fires, both caused by warmer, drier winters attributed to climat...

War in Ukraine will bring long-term hurt to European construction

2022-04-01T12:16:00-04:00

Over one month since Russia launched a full-scale invasion of Ukraine, the impacts of the war on Europe’s construction sector are beginning to emerge. Since the military offensive began, a steady increase in European sanctions against Russia has curtailed material supplies across the continent, while the uncertainty surrounding the supply of Russian oil and gas to Europe is expected to cause significant cost increases for manufacturing and supplying construction products.

Although the conflict has been ongoing for over a month, industry groups from Europe and the UK predict that the worst is yet to come for the AEC sector. The progressive nature of sanctions, the prior availability of products already in stockpiles or supply chains before the conflict began, and the tendency for manufacturers to agree on energy prices well in advance of supply, have all created a lag between events in Ukraine and their impact on construction sites.

“All projects are likely to be affected by issu...

Lumber shortage hits the metaverse, leads to construction delays

2022-04-01T08:00:00-04:00

A new report released today by the industry group Lumber Supply Research Group (LSRG) reveals a dramatically increased scarcity of lumber in the digital realm as demand for the sought-after material has skyrocketed within the last quarter, leading to significant price hikes and delays in construction projects throughout the industry.

According to the report, average rates per cubic pixel of digital lumber have increased by 73% since the beginning of the year, marking a three-fold price jump compared to the beginning of Q2 2021. Throughout March alone, prices soared to unprecedented levels, leaving wholesale traders of the coveted commodity often without inventory and contractors stranded.

"What the market has been experiencing over the past months can be attributed to two major factors," says LSRG analyst Michael Chen. "One reason is the unregulated deforestation in Minecraft which has left entire stretches of old-growth forest barren without sustainable concepts in place to replan...

Lumber prices are still soaring, and not just because of COVID-19

2022-02-22T11:16:00-05:00

Lumber prices have seen dramatic rises and falls during the COVID-19 pandemic. In May 2021, prices saw a 90% increase on the previous 12 months, adding an extra $36,000 onto the cost of constructing a new home in the United States. The record-high in May was followed a 40% decline in prices in June alone; the largest monthly drop on record.

The new year, and a subsiding of the pandemic, has done little to stabilize the lumber market. According to new reporting by Newsweek, the price of lumber has once again surged throughout 2022, with the price of softwood lumber rising 25.4% in January alone. At $1,272 per thousand board feet, the price of lumber remains three times more expensive that the average price before the COVID-19 pandemic.

While surges in material rates throughout the pandemic have been widely attributed to labor shortages caused by government restrictions and stay-at-...

Materials prices rise 20% in 2021 according to new report

2022-01-18T16:54:00-05:00

Although the prices of some raw materials fell in December, costs are still sky high for contractors looking to purchase them, according to a new analysis by the Associated General Contractors of America. Overall, the price of construction materials jumped nearly 20% in 2021, the group said Thursday.

In addition, according to the Associated General Contractors of America’s (AGC) 2022 Construction Hiring and Business Outlook Survey, material costs were listed as a top concern for contractors this year.

Though prices moderated for some construction materials in December, they still ended the year with large gains. For example, the price index for steel mill products rose 0.2 percent in December, its smallest rise in 15 months, but soared 127.2 percent over 12 months. The index for diesel fuel declined 5.3 percent for December but increased 54.9 percent for the year. Prices for other materials, such as plastic construction products and lumber and plywood, yielded accelerated price hikes in December.

The Association believes that rising materials prices are threatening to set back a strong outlook of economic recovery in 2022. They’ve urged the Biden administration to reconsider its plans to double tariffs on Canadian lumber and to remove other trade barriers that are driving infl...

The University of Idaho is awarded $4 million to develop 3D-printing technology that converts wood waste into building materials

2021-10-21T14:30:00-04:00

The University of Idaho recently announced that it has been awarded nearly $4 million from the National Science Foundation’s (NSF) EPSCoR Research Infrastructure Improvement Program to develop technology for the conversion of wood waste into 3D-printing building materials.

Research will focus on the further development and testing of an additive manufacturing process as well as the design and construction of a 3D printer capable of producing modular wall, floor, and roof panels printed from wood. Funding for the research extends through 2025.

“We’re developing a new composite material, using completely bio-based resources on a truly large scale,” said University of Idaho College of Engineering assistant professor and research lead Michael Maughan. “With this technology, houses and commercial buildings can be made entirely differently. We can push past climate change, mitigate impact on our environment, and make better use of the natural resources we have.”

Previously on Archinect: N...

As prices for construction materials begin to level off, higher labor costs will impact the industry entering 2022

2021-09-22T13:45:00-04:00

Since lumber, steel, and other construction material costs began skyrocketing during the summer of 2021, Archinect has followed the ongoing fluctuation of construction costs. During our July construction coverage, the cost of lumber began to drop, which brought a slight glimmer of relief. However, this eventual "return to normalcy" isn't without its additional challenges.

Previously, Archinect reported that the decline was "attributed to a number of factors, including reductions in both speculative trading and DIY home building, and a gradual normalization of supply chains as economies re-open following over a year of reduced output."

According to a recent report from Construction Dive's Sebastian Obando, however, the next looming issue the industry continues to be at odds with is project delays and labor costs.

Previously reported on Archinect: Construction Casualties: The Deadly Cost of Skyscrapers for Immigrant Laborers

Associated Builders and Contractors Chief Economist Anirban...

Lumber prices are falling fast after COVID-19 disruption

2021-07-09T12:40:00-04:00

Lumber prices have seen their largest monthly drop on record, after a year of inflated prices driven by COVID-19 disruption. Throughout June alone, lumber prices declined more than 40%, driving an 18% overall decrease throughout 2021. The decline is attributed to a number of factors, including reductions in both speculative trading and DIY home building, and a gradual normalization of supply chains as economies re-open following over a year of reduced output.

According to material trade publication Fastmarkets Random Lengths, the “cash” price for lumber has fallen by $160, now averaging at $770 per thousand board feet. This represents a 49% decrease from an all-time high of $1,515 set on May 28th. As noted by Fortune, lumber prices nonetheless remain significantly above their pre-pandemic range of $350 to $500 per thousand board feet.

Previously on Archinect: Timber prices and other factors are exacerbating America's housing shortage

"The move up in lumber prices was quick and vi...

U.S. could double tariffs on Canadian lumber, despite soaring timber prices

2021-05-31T13:04:00-04:00

The U.S. Commerce Department has released a report concluding that the United States must double its tariff on Canadian softwood lumber, raising the figure from 9% to 18%. As reported by Fortune, the increase would seek to combat alleged unfair Canadian trade practices, where lumber production is subsidized by the Canadian government.

Canadian softwood lumber accounts for over 25% of all softwood lumber used in the U.S. construction sector. A doubling of tariffs on imports would further compound the major increase in construction timber prices across the United States, which have risen 323% since April 2020 and now sit at an all-time high.

As we detailed last week, timber prices are one of several factors currently exacerbating America’s housing shortage, where inflated costs have added an average of $36,000 in expenses to each new development. The current disruption to material supply chains caused by the COVID-19 pandemic may take between 18 months and two years to fully resol...

Contractors petition Biden to ease rising lumber costs

2021-02-25T11:45:00-05:00

Following the sudden, dramatic price spikes on an array of building materials in 2021, the Associated General Contractors of America has appealed to President Joe Biden to take action to ease the skyrocketing cost of lumber.

According to Construction Dive, "AGC CEO Stephen Sandherr asked Biden to urge domestic lumber producers to ramp up production to address growing shortages, as well as to make the crafting of a new softwood lumber agreement with Canada a top priority of his administration."

Architecture firm Hou de Sousa creates a multi-functional outdoor educational facility for New York's Socrates Sculpture Park

2019-05-10T18:35:00-04:00

In 2016 the Brooklyn-based firm Hou de Sousa submitted a winning proposal for the Folly Competition held by the Architectural League of New York and Socrates Sculpture Park. The goal of the project was to create a newly designed open-air education facility that would act as a permanent replacement to the previous facility which was severely damaged during a storm. Hou de Sousa created a structural space - frame design out of standard dimensional lumber. The structure's interconnections formed a structural space-frame which acts as a wall and roof system for the facility. Appropriately called Sticks, the project was intended to "ornamentally highlight the design strategies being deployed as well as prototypically demonstrate potential implementations of this construction method at future locations." Due to the facility's design success, the team has created an extension to the project called, Sticks II.