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Americans Spark Lumber Shortage in Escape from the City

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By Miljan Zivkovic @ Shutterstock.com

You have read about the lumber shortages facing America as economic activity heats up. Americans escaping the city have initiated a housing boom that is creating lumber shortages. The Wall Street Journal reports on one woodworker here in Newport, RI that ordered four times the lumber he normally would, and still didn’t have enough. The Journal explains:

When woodworker Michael Hendershot stocked up with lumber in March ahead of building season, he feared the coronavirus pandemic would disrupt the supply of wood more than demand for fences, decks and cabinets. He multiplied his usual order by four.

He was right. But he could have bought even more.

Lumber consumption along Rhode Island’s coast, as elsewhere in the U.S., has exceeded even optimistic forecasts, leaving home builders, retailers and craftspeople like Mr. Hendershot clamoring for wood.

Saw mills are having a hard time keeping up. Prices for wood products are hitting records all over the country.

Even in the all-markets rally that has sent stocks, bonds and commodities rising in unison since the economic shutdown, forest products stand out for how sharply their prices have climbed.

Lumber futures have more than doubled since early April, when roughly 40% of North America’s sawing capacity was curtailed by mill owners. They expected widespread job loss and economic uncertainty would torpedo demand for building products.

Instead, stuck-at-home Americans undertook home-improvement projects en masse. Home builders are rushing to meet soaring demand for houses, stoked by historically low mortgage rates and a flight to the suburbs.

“Our sales folks are spending three, four, five hours a day, dealing with customers that don’t have any inventory,” said Christopher McIver, vice president of sales and marketing at West Fraser Timber Co., North America’s largest lumber producer. “Whether it’s in plywood or whether it’s in lumber, everybody is still very, very short, including the box stores.”

The Fed is enabling the boom with massive doses of monetary drugs. Americans need to pay close attention to the value of the dollar. Investors are flocking to silver to protect themselves.

Silver is a counterbalancer, as is gold. You should have diversification and compound interest built into your investment plan to protect you in times like these.

You need to get serious about your family’s personal and financial security. If you are serious, click here to sign up for my monthly Survive & Thrive newsletter. It can help you achieve your security goals, but only if you’re serious.

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E.J. Smith - Your Survival Guy

E.J. Smith is Founder of YourSurvivalGuy.com, Managing Director at Richard C. Young & Co., Ltd., a Managing Editor of Richardcyoung.com, and Editor-in-Chief of Youngresearch.com. His focus at all times is on preparing clients and readers for “Times Like These.” E.J. graduated from Babson College in Wellesley, Massachusetts, with a B.S. in finance and investments. In 1995, E.J. began his investment career at Fidelity Investments in Boston before joining Richard C. Young & Co., Ltd. in 1998. E.J. has trained at Sig Sauer Academy in Epping, NH. His first drum set was a 5-piece Slingerland with Zildjians. He grew-up worshiping Neil Peart (RIP) of the band Rush, and loves the song Tom Sawyer—the name of his family’s boat, a Grady-White Canyon 306. He grew up in Mattapoisett, MA, an idyllic small town on the water near Cape Cod. He spends time in Newport, RI and Bartlett, NH—both as far away from Wall Street as one could mentally get. The Newport office is on a quiet, tree lined street not far from the harbor and the log cabin in Bartlett, NH, the “Live Free or Die” state, sits on the edge of the White Mountain National Forest. He enjoys spending time in Key West and Paris. Please get in touch with E.J. at ejsmith@yoursurvivalguy.com To sign up for my free monthly Survive & Thrive letter, click here.