Industry uncertainty tightens lumber supply

SEATTLE (Scrap Monster): Demand for softwood lumber remained muted as customers felt only more cautious about external factors like macro-economic conditions and skyrocketing fuel prices. 

Sellers responded by continuing to keep their sold wood inventories low, as confusion reigned and no one wanted to get stuck with high-cost material if prices fall. Concern about having to fill inventory holes with material at below-replacement costs was on the top of everyone’s minds.

As in 2025, the instant snow melted, wildfires started. British Columbia already put in a fire ban at the end of April. Sawmills had spent the winter focused on timber harvest, so operators were well loaded up with fibre in their log yards. Whenever proper demand does arrive, lumber producers will be able to increase production to meet that. If business continues at a slow pace, sawmills will remain in curtailment / downtime.

In the week ending May 1, 2026 the price of Western Spruce-Pine-Fir 2x4 #2&Btr KD (RL) was US$490 mfbm, which was flat from the previous week, according to weekly forest products industry price guide newsletter Madison’s Lumber Reporter. That week’s price was flat from one month ago when it was also $490. Compared to the same week last year, when it was US$460 mfbm, the price of Western Spruce-Pine-Fir 2x4 #2&Btr KD (RL) for the week ending May 1, 2026 was up +$30, or +7%. Compared to two years ago when it was $408, that week’s price was up +$82, or +20%.

In the week ending May 1, 2026, the price of Southern Yellow Pine East Side 2x4 #2&Btr KD (RL) was US$505 mfbm. This was down -$30, or -6%, from the previous week when it was $535. That week’s price was down -$56, or -10%, from one month ago when it was $561.

Lumber market takeaways from recent weeks:

• Players of Western-SPF in the U.S. reported precious little slack in the system.

• Purchasing continued to be on a lean, hand-to-mouth basis.

• Limited overall supply and ongoing issues in transportation wreaked havoc with production schedules and delivery timelines. 

• Demand for Western-SPF in Canada was undeniably better than at the start of April.

• Price spreads between sawmill-asking and on-the-ground grew further.

• Trading volumes of Eastern-SPF were decent — though subpar for the time of year.

• Southern Yellow Pine continued trading down in a freight vacuum, while price fragmentation and availability discrepancies increased again.

• Delayed deliveries and frustrated retail customers abounded as trucking issues dominated much of the conversation. 

The Madison’s Lumber Prices Index for the week ending May 1, 2026 was: US$524 mfbm. This was flat the previous week, and was down -5%, or -$28, from one month ago when it was US$552.

Inventories of solid wood material throughout the supply chain were still low, something that has lately become a chronic situation. Most were reluctant to increase their inventories for fear of getting hit with higher replacement costs. Transportation problems abounded across the continent, with buyers and seller alike spending more time locating their trucks and rail cars than actually making deals. Rapidly increasing fuel costs were on the top of everyone’s minds.

Courtesy: www.hbsdealer.com