OT: Crazy Markets

[Jeffreauxdawg]

While we are on the topic. 7/16" OSB is selling at $1025/msf at the mill in some areas. That means if you bought a truckload of it from the mill right now you would pay $32.80 per sheet before freight. It will probably be up over $40.00 per sheet at Home Depot and Lowe's soon. It's normally around $10-15 per sheet at home Depot and as low as $6.00.

That situation may not get better for months either. If you are building and aren't already under contract, it's going to sting bad.

In the commodity world this is the equivalent of paying $10.00 per gallon of gas. Wild.

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[Xenomorph]

So why exactly is timber nearly worthless?

 

[harrydawg.sixpack]

Great question - can someone plain this?

 

[Jeffreauxdawg]

There are plenty of logs. The mills are just all at capacity. I talked to a friend of mine today in the Mid-South with a huge OSB producer and they are sold out until June 7th. Even then it will be allocated for the rest of the year.


The biggest challenge is the lack of want for southern pine. We grow it so fast now it has less strength and more warp/twist. There are engineered products that have replaced traditional syp usages (I-Joists instead of 2x12, Trex instead of treated decking, slab on grade instead of wood subfloor over crawlspace.)

 

[M R DAWGS]

Plenty of pine trees/lumber, very few mills. Mills taking advantage of the situation.

 

[msu4ever]

What’s the outlook for timber? Any chance for a rally?

 

[harrydawg.sixpack]

It appears that there are many reasons for what we are seeing - several mentioned above.
On top of this - federal programs which paid land owners to plant trees in place of agriculture has worked too well......

 

[Jeffreauxdawg]

Southern timber markets have been oversupplied for a decade. It will probably get a little better, but don't expect much.

 

[Jeffreauxdawg]

...
On top of this - federal programs which paid land owners to plant trees in place of agriculture has worked too well......

This is a good point. Add in that southern hardwood has been out of favor for a decade plus and southern yellow pine stands can reach clear cut maturity in less than 30 years... It's not a good recipe.

 

[jethreauxdawg]

Seems like 20-30 years ago the paper companies sold off all their land convinced everyone to start planting pine. It has worked beautifully for them. Well played.