Softwood lumber prices fell 23% in June after two years of volatility. <\/p>\n\n\n\n
The National Association of Home Builders (NAHB) today published an\u00a0analysis\u00a0of the U.S. Bureau of Labor Statistics’ Producer Price Index Summary, which showed that softwood lumber prices fell 23% in June.\u00a0<\/p>\n\n\n\n
The analysis noted that residential construction materials prices increased 1.5% last month, despite lumber’s dip.\u00a0<\/p>\n\n\n\n
According to NAHB, prices have surged 41.7% since January 2020. Building materials (i.e., goods inputs to residential construction, less energy) prices have increased 4.8%, year-to-date, and are 12.2% higher than they were in June 2021. The price index of services inputs to residential construction was driven 2.1% lower in June after a 2.0% decline in May (revised) by decreases in the building materials retail and wholesale trade indices. The services PPI is 0.1% lower than it was 12 months prior and 37.6% higher than its pre-pandemic level.<\/p>\n\n\n\n
The PPI for softwood lumber (seasonally adjusted) fell sharply (-22.6%) in June, its second such decline in three months. Prices have fallen 35% since March 2022, although the extent to which the decrease has reached home builders and remodelers is unclear, NAHB said. <\/p>\n\n\n\n
Since early 2020, softwood lumber prices have been extraordinarily volatile. The average monthly change in the PPI for softwood lumber has been 2.6% since January 2020, nearly nine times the average change (+0.3%) from 1947 to 2020. The volatility of softwood lumber prices has exhibited the same pattern relative to the \u201call commodities\u201d PPI. While lumber prices were 19.7% more volatile over the 1947-2020 period, they have been 100.1% more volatile than the broader index since January 2020.<\/p>\n\n\n\n