Lumber prices too high

[Al_Smith]

Nearly every commodity given enough time will see a correction .Some will be gleeful some will pull their hair out .
I have enough steel bar joists, I beams, standing seam roofing and siding to erect a 40 by 60 building .I don't have the lumber it will take though for nailers .I can wait it out which it will come down .If not I still have the steel items which are worth something ,probably more than I paid for them .

[tamarackman]

There was a time when people who traded commodities in high volume had to be able to take delivery of the commodities they traded.  But regulations are bad and Buffy Richington the fourth can push lumber futures to $2000/mbf. 

Last year around May, oil futures went negative. As in, people were so desperate to not have to take delivery of oil that they were paying people to take their oil futures off their hands before the end of the month.

The markets are now primarily a means to an end in-themselves (speculation). And the value "created" by speculators gets to be spread out among the schmucks that actually need the commodity i.e. us. 

[stavebuyer]

You're clearly one of the people who have asked for this to happen so lay down in the bed you made for us and quit complaining.

Yeah, thats me.  You got me all figured out.  Crawl back under whatever socialized rock you came from.

Thank you for saying what needing to be said Mr. Belben. 

[nativewolf]

There was a time when people who traded commodities in high volume had to be able to take delivery of the commodities they traded.  But regulations are bad and Buffy Richington the fourth can push lumber futures to $2000/mbf.  

Last year around May, oil futures went negative. As in, people were so desperate to not have to take delivery of oil that they were paying people to take their oil futures off their hands before the end of the month.

The markets are now primarily a means to an end in-themselves (speculation). And the value "created" by speculators gets to be spread out among the schmucks that actually need the commodity i.e. us.

Very true we had chinese speculators (that went bellyup) buying all the oil they could saying it was cheaper than water (true also).  Then a group of very savvy english day traders figured out that they could squeeze the oil market on closing day by hammering the delivery price on end of quarter closing.  This was a recognized risk by many large companies but the new money (chinese entity) was not properly hedged and lost everything.  English day traders scored over $600 million that afternoon, very good write ups about that in one of the financial reports (FT, or WSJ or something).  The english day traders were a rough and tumble group of non college educated professional traders, not wall street types at all.  They had a score for the ages.  In the meantime...average joe at the gas pump was getting $1.50 gas and I had 3 offers for off road at less than a dollar a gallon.  No money then and a 2000 gallon double walled fuel tank.  Sigh...  

[Al_Smith]

I would not have the nerve to be a day trader and for that matter I don't gamble on anything .I have private  investments ,mutual funds and 401 k's plus an inheritance in stocks .I have not touched them ,I don't need them .They are diversified enough if one tanks the  others rise .
Oh the bankers who think they know more than me try their best but it's not  their money it's mine .If I want to bury it in the back yard or stuff it in a mattress  that's my business not theirs .
The nay sayers try to preach doom and gloom which frankly I don't .They can jump out of buildings if they want .I'll just sit on my patio under the hot sun of summer under an umbrella and watch them --of course with a few cold ones to stay hydrated and keep Budweiser in business . ;D

[nativewolf]

I would not have the nerve to be a day trader and for that matter I don't gamble on anything .I have private  investments ,mutual funds and 401 k's plus an inheritance in stocks .I have not touched them ,I don't need them .They are diversified enough if one tanks the  others rise .
Oh the bankers who think they know more than me try their best but it's not  their money it's mine .If I want to bury it in the back yard or stuff it in a mattress  that's my business not theirs .
The nay sayers try to preach doom and gloom which frankly I don't .They can jump out of buildings if they want .I'll just sit on my patio under the hot sun of summer under an umbrella and watch them --of course with a few cold ones to stay hydrated and keep Budweiser in business . ;D

That's the way to do it.  Keep you head while others are losing theirs and you'll do well.

[Al_Smith]

I think it's all how you look at things . My great grand mother, her son my grandfather ,my dad and his brothers did very well in the stock market over a period of time .I've done okay but not a record like I'm a "young Turk" or something.
Being the oldest I am administer of that estate and one of dads brokers ask me if I wanted to change anything with  my share .My reply while I inherited his mechanical aptitude I did not his understanding of financial matters .The old man forgot more than I will ever know--let 'er ride----Really if you cut through the fog how much money does a person really need or really want ? ;)

[mike_belben]

Money is not the fruit of life.  Its not the machine, its just the grease for the machine.  


My life without money has been much more fulfilling than the one i had with it. 

[Kim_Ked]

They keep feeding us demand is up with all this COVID money. Well, if you're not working and you're getting that, how are you further ahead? Only way we get that money up here, as a non-business entity, is if not working, kind of unemployment. We don't get a $900 a week cheque from work, plus $2000 a month extra unless you have 4 kids (and you already had that money anyway before COVID). So the math don't work for higher demand unless you guys down south get paid from your employer plus government COVID on top. All construction around here is commercial, so steel not wood. Not a single house being built in my travels. Crabbe's mill yard is stuffed full of wood that has sat for months uncovered and getting a little grey around the edges. Still sawing and kilning. When it gets to a point of no return, they can shove it through the pellet mill. :D

Only the filthy rich are building with $2000/mbf 2 x's and $120 a sheet 1/2" spruce plywood. :D

Somebody is the gate keeper and it ain't the consumer, nor is it the loggers. If it were me I'd shut down logging until I got my share. It's just equipment, so tell the financier to come get it if they want it that bad. :D  

Had a guy suggest you can sell biomass (low quality wood) for $60/cord. I said why would I do that when firewood is $300+ a cord? I wasn't raised a fool. :D

I hear you on this one...
I just took my processor off this weekend, switched back to a digger. 
I'm giving my wood away, leaving the lower value stuff to rott in the road as its worthless now, we cant sell pulp at all.... Cutting for somebody else is simply a slap in the face and not even worth enough to consider trying again after the last shirt loosing endeavor. 
I'm going to finish my roads that I want to get built and maybe do mining on the back side of my property to see what I can find. I'm abundant with clear fill and the best top soil you can ask for. I might try to see If I can sell some of it. I had somebody the other day poking around looking for boulders. Perhaps there is an opportunity.  For now, the logging, as much as that's what I like to do, doesn't look very promising. At least in my neck of the woods. Perhaps Ill do some more next winter. That's when its the nicest in the woods anyway.

[PoginyHill]

Its that stupid people will soon demand price controls, and our system cannot recover from that plague once it spreads to everything. 

Price controls = shortage. Gas lines of the early 70's and lack of housing in NYC are examples.
Left alone, supply and demand will always equal each other at a given price. But that's another thread.
When those to whom lumber prices don't matter much have finished their projects, prices will come down and the rest of us will resume our projects. If the price of lumber was controlled or capped, then we'd all place our orders and wait who knows how long for delivery - shortage.

[nativewolf]

Right now lumber seems most constrained by trucking.  I know that even hardwood mills and kilns can't ship lumber at the rates they want, no drivers.  Why no drivers is another topic and one I don't have any impact on.  I can only surmise that in many areas trucking still does not pay enough.  

We're blessed to have trucking so our logs get out thank goodness.

[mike_belben]

Absolutely.  Price controls create surplus of stuff no one needs and shortages of stuff everyone needs. They come from government trying to manage economy and misery is always the result.  


People love the right to vote even if the political system is completely broken and everything government touches turns to mud.  

In a free market, your dollar is your vote.  Stop giving it to lowes and home depot.  Just wait on your new porch, cruises and flights are cheap. Take one of those instead.

[mike_belben]

Right now lumber seems most constrained by trucking.  I know that even hardwood mills and kilns can't ship lumber at the rates they want, no drivers.  

Lumber as a trucking commodity is a unique animal...  The freight business has been going through these boom bust rate cycles for decades and the public just doesnt know what goes on behind the scenes.  
...more on the later, gotta get kids ready.

[Southside]

The rates drivers are paid are not the biggest factor in many cases.  I know locally guys make enough money in three or four days with their truck that it just gets parked - they don't have the desire to work any more than that and the wood does not get moved, see it time and time again.  

Read an article over the past two weeks where a significant trucking company was saying the issue they are facing is that guys are happy making $70K a year driving a truck and just won't work past that.  They throttle themselves to make the magic number and then park the truck.  How do you fix that?  If wages go up then miles and freight moved will actually go down.  

[gspren]

How much per bd ft is poplar going for at the sawmill? This summer I want to build a 12 x 26 loft area in a pole building and could use 1"x8" poplar instead of 3/4" plywood. Could also use poplar 2x8s instead of spf store bought.

[Southside]

Got a call this morning guy wanted to buy my mill so he can saw his yard timber for his house and outbuildings he wants to build. 

[HemlockKing]

Got a call this morning guy wanted to buy my mill so he can saw his yard timber for his house and outbuildings he wants to build.

Most mills are a year wait time now, I'm waiting until spring 2022, people are saying heck with this junk, I'd never pay what they are asking for lumber, we will see a correction I think once all these DIY fellas pick em up. Maybe not though obligatory"not an expert"

[tamarackman]

The rates drivers are paid are not the biggest factor in many cases.  I know locally guys make enough money in three or four days with their truck that it just gets parked - they don't have the desire to work any more than that and the wood does not get moved, see it time and time again.  

Read an article over the past two weeks where a significant trucking company was saying the issue they are facing is that guys are happy making $70K a year driving a truck and just won't work past that.  They throttle themselves to make the magic number and then park the truck.  How do you fix that?  If wages go up then miles and freight moved will actually go down.  

But isn't that the point of life; to enjoy it? If the solution is to make people desperate enough that they must work 40+ hours a week to make ends meet then you can count me out.
I work more than 40 hours of week but that's because I can and do enjoy my work.  Most people aren't so lucky.

[nativewolf]

Yes, @spdm that is reality and theory hitting head on.  Theory says that should be a great lifestyle for many and attract new drivers.  That is the free market sort of look and one I like, give it time, work at Walmart or drive a truck for more $ and less hours.  

[Hilltop366]

I've known a few of those on the road 24/7    50 to 51 weeks a year drivers. Home long enough to sign the divorce papers and pay the lawyer....no thank you, what miserable people to be around. 

There has to be a better way to live and a better way to transport goods.

[mike_belben]

that is the hired driver reality.  youll see your family exactly 3 days a month, youll see our dashboard with our cameras recording you picking your nose the rest of the time.  we need the camera watching your every second for "safety."  well.. unless the truck breaks,  then you can see the fam 1 day this month because weve got this really really hot load of lumber for you to deliver right next to all the other mountains of lumber sitting in that really important big box parking lot.  

oh and the gutless ugly plastic truck is governed at 62, for safety.  and it automatically slams on the brakes when the crash avoidance system, which is smarter than you are, gets a snow glare.  this is to make every other driver in hillcountry hate you for safety, to us, for liability insurance discounts so we can undercut the competitors and get all the worst freight.  now if you do anything our onboard systems dont like we will have a miserable dispatcher who you have never even seen route you to the nearest hub for surprise termination, leaving you stranded 1800 miles from your home and your private vehicle, with a mountain of your stuff that cant go on the flight or bus home.  

this is a super super common story of modern day hired driver. its hell.  i didnt have any of that because i was lucky enough to catch an old fashioned cowboy trucking company desperate and willing to employ me with some unique stipulations, but old fashioned "outlaw" trucking is completely illegal.  very very illegal, and every state trooper is tasked with ending your easy going outlaw trucker career.


i will get to lumber brokering later.

[Southside]

But isn't that the point of life; to enjoy it?

Guess I am more in the camp of life is about planting trees of which the shade I know I will never rest under.  Honestly some glad those who came before me left more than they kept.  

[tamarackman]

Guess I am more in the camp of life is about planting trees of which the shade I know I will never rest under.  Honestly some glad those who came before me left more than they kept.  

Ain't got time to build a future for my kids nor lay the foundation upon which my they will build their future if I'm in a truck 50 weeks of the year paying child support to my now ex-wife because I could not stop to smell the flowers.

And asking my fellow man to make less to work more hours so I can sell more of my product at a less-than market price ain't me neither.

And I mean the above with no disrespect. I worked my fair share of minimum wage jobs (and if you add up the hours I work on the farm I probably still do), but to ask the next generation to be content with slaving away so that the next generation after that can hopefully do the same ain't right.

I noticed that pulp futures are way up as well. I think I understand why lumber is up compared to logs based on some of the comments made in this thread. Mill and trucking capacity is fixed while log supplies are way up. But pulp futures being up doesn't really make sense since the demand for paper products should be pretty consistent. Right?

[Magicman]

Got a call this morning guy wanted to buy my mill

I am getting these calls almost weekly.  My selling price is $55K which should put me out of the selling market.  ;D

[Southside]

Might be because his next question was "Do you know where I can buy a sawmill?" and I gave him your number Magic Man.   :D