What do These Lumber Prices Represent?
LBS1! lumber prices measure the latest market price for the current futures contract of random length (8′ to 20′) 2×4 softwood lumber. The lumber price shown is per thousand board feet (MBF).
Where is the Wood for These Contracts Being Sourced?
Wood from these contracts must be sourced from mills located in Oregon, Washington, Idaho, Wyoming, Montana, Nevada or California, or the Canadian provinces of British Columbia or Alberta
Do These Lumber Prices Reflect the Value of my Timberland?
It depends. Prices may indicate demand for structural timber, butthis is only one product from specific species in a specific region. Other products, like hardwood lumber and pulp, will differ radically in price. Moreover, these are prices paid to mills, not landowners. The value of your timberland will ultimately depend on its cashflows.
What Makes the Price of Lumber Go Up or Down?
Like all markets, lumber prices are beholden to the laws of supply in demand. Because these prices reflect structural 2x4s only, prices are primarily a function of the housing market. Metrics such as housing starts can therefore help you gauge the likelihood of prices moving up or down.