Wood prices to drop, but will remain high into 2021, says homebuilder

A Saskatchewan home-building company is predicting a reprieve from high wood prices by Christmas after COVID-19 caused a construction wood shortage across the country.

“(The price) is quite high, but we expect it to drop approximately 20 per cent over the next few months and that’s where we think it will sit stable for the near future,” said Rick Casavant, president of Warman Home Centre.

Panel wood has tripled in price while lumber is more than double what it cost compared to spring when the pandemic first began, according to Casavant. That has increased the cost of building a new home valued at $400,000 by $12,000 to $16,000.

He says the wood shortage caught everyone off guard.

“There are lots of times we’re scrambling or using subsidy products to be able to complete orders or there are long periods of delays,” he said. “It’s nothing like any of us have seen before.”

Casavant said even though a price drop is coming, he warns a return to pre-COVID-19 wood prices is still a long way off. He said the supply chain remains affected by mills that simply don’t have enough raw material.

“Treated mills used to have lumber stacked 16 to 20 feet,” he said. “You drive to those mills today and all you see is asphalt. They need to fill up those yards before they can start treating.

“Demand is so high that I don’t think it will come down next year. They have an order file out to 2021 already and if we get a second round of COVID, that will change everything and prices will go back up again.”