26.08.202517:34:20UTC+00Lumber Drops to Mid-May Lows

Lumber futures have declined to approximately $580 per thousand board feet, marking their lowest level since mid-May. This drop can be attributed to a decrease in demand, increasing inventories, and trade tensions, which have collectively tipped the market in favor of sellers. In July, U.S. building permits declined to a seasonally adjusted annual rate of around 1.35 million, marking their lowest point since June 2020. Concurrently, the 30-year fixed mortgage rate remains in the mid-six percent range, which is dampening homebuying activities and postponing new constructions that could otherwise reduce excess supply. On the supply end, lumber mills and distributors, having previously cut back production, have now either resumed operations or cleared existing backlogs. According to Statistics Canada, production and shipments are on the rise as of mid-2025, resulting in higher inventory levels and dampening the potential for a price recovery. Additionally, increased U.S. duties on Canadian softwood have altered shipping routes, escalated transaction costs, and prompted sellers to offload stock in less saturated markets rather than tightening domestic supply, thereby maintaining downward pressure on prices.