Despite the uncertainty, she struck a cautiously optimistic tone: "The global supply chain has proven to be incredibly resilient, even during crises like COVID and the Red Sea conflict. The key to success is agility—being flexible and prepared for change."
By staying informed, diversifying supply chain partners, and leveraging strategic forecasting tools, she noted, businesses can better navigate market disruptions and maintain stability in an unpredictable world.
Lumber Market Stability and Forecasting
Keta Kosman, publisher of Madison’s Lumber Reporter, explored recent trends, pricing stability, and key factors shaping supply and demand. Her presentation painted an optimistic picture of a market returning to normal seasonal fluctuations after years of extreme volatility caused by COVID-19 and supply chain disruptions. "The trend line for 2023 and 2024 is looking really good—stable and even," she noted, emphasizing that while lumber prices remain higher than pre-COVID levels, the market has settled into a more predictable rhythm.
Kosman underscored the crucial link between U.S. housing starts and lumber demand, as home construction remains the largest consumer of softwood lumber in North America. Recent data shows that total housing starts are up 15%, a promising indicator for increased lumber consumption. She pointed out that mills are now quicker to curtail production when demand slows, preventing the market oversupply that once drove prices to unsustainable lows. "You’re not going to see $250 per thousand board feet anymore," she explained, adding that the cost of production has increased significantly, forcing mills to maintain pricing within a controlled seasonal range.
One of the most pressing concerns for 2025 is the impact of tariffs on Canadian lumber imports into the U.S. With existing duties already at 14% for major producers, additional trade restrictions could further complicate cross-border lumber flows. "The issue isn’t just the cost—it’s the uncertainty," Kosman stated.
The issue isn’t just the cost—it’s the uncertainty
Many buyers are stocking up now to hedge against potential price hikes, while Canadian suppliers are accelerating exports to the U.S. before any new tariffs take effect. She also highlighted shifting buying patterns, with some U.S. customers opting for domestically produced Southern Yellow Pine over Canadian Spruce-Pine-Fir (SPF) due to these trade concerns.
Looking ahead, Kosman urged WPA members to closely monitor housing starts and sawmill production volumes, as these are the best indicators of lumber availability and pricing trends. She advised businesses to leverage historical pricing data, housing permit trends, and lumber futures markets for better forecasting. "The key takeaway is that supply and demand are finding a balance," she said. "Mills have the capacity to scale up production as demand increases, so we’re not expecting any major price shocks—barring unforeseen disruptions like wildfires or labor strikes."
The outstanding keynote by Merrill Hoge, the business development panel, and Chaille Brindley’s presentation on pallet plant technology appear as separate features in this issue.
WPM
February 2025