Advertisement

Spike in lumber prices worries some Lethbridge homebuilders

Click to play video: 'Spike in lumber prices worry Lethbridge homebuilders' Spike in lumber prices worry Lethbridge homebuilders
Homebuilders in Lethbridge say they may have to pause projects in response to skyrocketing lumber prices. As Emily Olsen reports, local lumber suppliers say the prices are largely being determined by demand from the United States – Aug 20, 2020

Jeff Gordon says skyrocketing lumber prices are threatening his livelihood.

“With the rising costs, the builders are literally contemplating just stopping building,” Gordon said.

“It means I have nothing to do and it means my eight employees have nothing to do,” he said.

Read more: Record lumber prices adding thousands of dollars to new home building costs

Despite a lull in demand due to COVID-19, he says prices for lumber products are nearly double what he typically sees.

“Yes, we’re busy now, but we were slow for a couple months there,” Gordon said. “And technically we were all labelled as essential, so there was no reason for the companies to slow down.”

Story continues below advertisement
Click to play video: 'Lumber prices adding thousands of dollars to new home building costs' Lumber prices adding thousands of dollars to new home building costs
Lumber prices adding thousands of dollars to new home building costs – Aug 18, 2020

Now he and local home-building companies are shouldering the burden.

Stephen Amonson, Lethbridge president of Tacada Residential, says sky-high prices could mean a halt to new projects.

“That puts jobs in jeopardy, that puts livelihoods in jeopardy and we have wrestled with this for almost a month now,” Amonson said.

“I don’t know who to point the finger at, but I think ultimately that’s what I’d like the government to look at. Because I’m told people can’t log to capacity and I’m confused.”

Read more: Contractors busy with home renos during COVID-19 pandemic

Story continues below advertisement

Brad Hoover from Logic Lumber says pressure from local business may not impact prices as much as they think.

“Even though we’ve seen an increase in the Canadian market, what really dictates our pricing is the U.S. market.

“We have seen more housing starts than normal in the U.S., we’ve seen the increase in demand in the U.S., we ship a lot of lumber down to the U.S. and that’s really what’s spiked our demand.”

Click to play video: 'Shortage of pressed lumber, chicken wire during national home renovation surge' Shortage of pressed lumber, chicken wire during national home renovation surge
Shortage of pressed lumber, chicken wire during national home renovation surge – Jul 16, 2020

He adds that some lumber mills did reduce or halt operations earlier this spring when lumber prices were at rock bottom, but it hasn’t impacted their inventory yet locally.

Story continues below advertisement

“We certainly see that there are some panic buyers out there and we’re trying to manage that as much as we can here,” Hoover said.

Read more: Record lumber prices adding thousands of dollars to new home building costs

In the meantime, Gordon waits to see exactly how his business will be impacted.

“It just reflects back on all the labour costs. It’s all the labour costs that are getting dinged,” Gordon said.

“And what do I do? I can’t go to my employees and say, ‘Hey, work for a dollar less.’ They’ll laugh at me.”

Those involved in the industry expect the prices will drop again, they just don’t know when.

Sponsored content