What’s happening to Lumber Prices?
2020 has been a year of highs and lows for the lumber industry.
Early on in 2020, when the pandemic was just starting to gain global publicity, lumber prices slumped. Starting in early March, and continuing on through mid-June, prices plummeted and held at a relatively low mark.
The initial slump was a product of the global shutdown in response to the novel Corona Virus outbreak. Construction operations in most locations were shut down, and lumber mills and other processing facilities were left with an excess supply of material. So, are you wondering what caused lumber to increase from roughly $250 per 1000 board feet to over $850 per 1000 board feet?
We’ve seen some of the lowest interest rates in recent history over the past few months in the US as a response to the fragility in the economy.
Low-interest rates for both home mortgages and new construction financing led to a boom in the building and remodeling industries when businesses opened their doors in June.
The boom in the building/remodeling industries turned the tables on the lumber industry. Mills and other processing facilities went from having an excess supply of wood to a shortfall in what seemed like a moment’s notice.
Ultimately, as the demand for lumber continued to increase over the past few months, supply has not been able to catch up, resulting in an increase in lumber’s cost by 340% or more in particular locations.
If you haven’t already, check out our updated post on When We Expect To See Lumber Prices Decline!
How we can help!
Although we understand that it is challenging to build without lumber, there are ways to minimize the amount needed to help cust costs. Here’s how we do it:
SIP Panel Construction
Less Lumber = Cost Savings
SIP panel construction practically eliminates the need for traditional 2x framing, which accounts for most of the lumber used in a conventional custom home or commercial project. Not only minimizing the amount of lumber needed to erect the structure, but also minimizing job site waste.
To better understand the composition of a SIP panel, check out “What are SIPs”, where we provide an in-depth breakdown of each component.
Less Waste = Cost Savings
On a typical stick build, 2x lumber arrives raw on the job site and has to be cut to fit prior to assembly. With SIP panel construction, every component is pre-designed, engineered, and cut to fit before shipping. Reducing waste and saving you money on lumber that would otherwise be disposed of.
Besides saving you money on wasted materials, SIPs construction can also save you money on waste disposal. An average 2,000 square foot home built conventionally can generate up to 6 tons of waste. Removal of waste at such a large scale can cost thousands of dollars, increasing your overall project cost.
Less Labor = Cost Savings
With all interior and exterior walls pre-cut and ready to be assembled, you reduce the labor needed to complete the structure. All paneling is cut with state of the art CNC machinery and therefore reduces the amount of time build crews spend on the site cutting sticks to size.
The assembly of a SIPs home is also very streamlined, reducing the overall time spent on the job site. Ranging anywhere from 20-60% faster than a traditional stick build.
For the full inside scoop on SIPs construction and why we think every builder should be using SIPs, check out our in-depth article.
SIPS Case Studies from our Partners: