The National Association of Home Builders (NAHB) has enlisted the help of the White House in finding a solution to rising lumber prices.
On Aug. 7, the NAHB sent President Donald Trump a letter that outlines concerns over the soaring prices of lumber and a supply shortage. Additionally, the NAHB wants a solution to the softwood lumber agreement with Canada along with an end to tariffs that average more than 20% on imported Canadian lumber.
In the letter to the President, NAHB CEO Gerald Howard said, “NAHB believes the White House can play a constructive role to alleviate this growing threat to housing and the economy by urging domestic lumber producers to ramp up production to ease growing shortages and making it a priority to work with Canada on a new softwood lumber agreement.”
Howard points to better-than-expected housing demand and home building activity, along with projects being done by the DIY segment, resulting in home builders seeing shortages of lumber along with an 80% increase in lumber prices since mid-April.
“Framing lumber prices reached a record high in late July, while oriented strand board prices have increased 138% over the past year,” Howard says in the letter. “These sharp increases are unsustainable, particularly in light of the housing affordability crisis."
Earlier this month, the NAHB sent letters to Commerce Secretary Wilbur Ross, U.S. Trade Representative Robert Lighthizer, and Zoltan van Heyningen, executive director of the U.S. Lumber Coalition, in an effort to address supply chain disruptions and tariffs that are contributing to price volatility.
The Random Lengths Framing Composite Price hit a record $627 per 1,000 board feet for the week ending July 31, marking the first time prices have topped the $600 level. Additionally, framing lumber prices have soared 80% since mid-April as the price of oriented strand board (OSB) hit $550 per 1,000 board feet at the end of July, rocketing 138% from a year ago.
Yesterday, the Associated Contractor Association reported that softwood lumber prices had risen as much as 25.7% in July in comparison to prices from July 2019, based on the latest U.S. Bureau of Labor Statistics’ Producer Price Index data.
“Housing can do its part to create jobs and lead the economy forward, but in order to do so, we need to address skyrocketing lumber prices and chronic shortages,” Howard said. “I respectfully request that you reach out to domestic lumber producers and urge them to increase lumber production to address these shortages.”
The NAHB’s full letter to President Trump can be read here.