Lumber retailers are slowly starting to see their prices reflect the current decrease in wholesale lumber prices at their stores.
In March wholesale prices peaked at around $1,400 per thousand board feet (the standard unit of measure for Western Spruce-Fir-Pine lumber), but in June took a nose dive dropping by 50-60 per cent.
In July, Discover Moose Jaw spoke with Paul Jannke, Principle of Lumber for Forest Economic Advisors about the state of lumber prices, and he said it would take until the end of August into September for retailers to see those price reflections.
Fast forward to now, Mark Westrum, Manager of Westrum Lumber in Rouleau, says that the decreases have been seen in their dimensional lumber such as spruce, fir, and plywood.
“They’re not as significant as what we’ve seen at the mill level on our weekly pricing, that takes a little bit of time to go through wholesale and then get down to the retail level. Significant decreases probably in that 30 per cent range already,” says Westrum.
Prices reductions in treated lumber haven’t been as noticeable as spruce, fir, or standard plywood, due to the lack of volume, Westrum notes.
When wholesale lumber prices peaked in March and prices increased drastically, those increases trickled down to the retail level, causing commonly used lumber to skyrocket.
“A 2x4x8 is currently running now at $8.50/board, that was up around $16-$17 dollars back in March. 7/16 OSB (Oriented Strand Board) was around about $84/sheet back at the peak (in March) and now as of today we’re selling that for about $31/sheet.”
Though lumber has slowly started to drop, and with more to come once the wholesale drop reaches retailers, Westrum is confident prices won’t fall as low as they were pre-pandemic.
“I think mills have established they’re going to get a little more for their product in Canada to hold it here versus shipping it all to the United States where they can get a lot more money for it. We’ll see some reductions but not to pre-pandemic prices.”
In Saskatchewan, lumber is a big producer as over half of the province is forested, representing 34 million hectares.
Forestry is northern Saskatchewan's largest industry. In normal market conditions, the forest industry generates over $1 billion in forest product sales annually and supports nearly 8,000 direct and indirect jobs.
Saskatchewan's forest industry currently has 62 per cent of the commercial forest certified to one or more of the following internationally recognized forest certification regimes:
Canadian Standards Association (CSA) Sustainable Forest Management
Forest Stewardship Council (FSC)
Sustainable Forestry Initiative (SFI)
Throughout the COVID-19 pandemic department stores such as Westrum Lumber were deemed an essential service, allowing them to stay open. With restrictions forcing most people to stay home, places like Westrum Lumber were booming.
“They had vacation money that they weren't spending. We were very busy during what we called the “COVID Renovation Phase” people did multiply projects in the year versus a fence this year, and a deck next year. They did fence, deck, and garage all in one shot.”
Westrum adds that being deemed an essential service allowed the store to not have to let any employees go, as did restaurants, gyms, hair studios, etc.
Though the pandemic for some people is in the rearview mirror, it still is causing headaches in terms of supply chain issues, from manufacturers that are still trying to keep up with the demand. At Westrum Lumber they are feeling that effect not for lumber, but for their resin products.
“That’s you vinyl sidings, paints, caulking, and spray foams all of those items were really hit by COVID and an ice storm that hit Texas two years ago. The industry just has not been able to recover from that, and a lot of places you may notice don’t have paint. Our orders of paint, we might get 20 per cent.”
The resin shortage has not only hit their four Westrum Lumber stores in the area but has affected the whole industry. Westrum adds that if you’re looking for an odd colour, they may not have a base to make that colour work.