Lumber Retreats From 2-1/2-Year High
Lumber futures have declined to below $620 per thousand board feet, pulling back from the two-and-a-half-year peak of $685 recorded on March 24th. This shift is largely attributed to the implementation of a 10% tariff by the Trump administration on all U.S. imports, which has intensified fears of a recession by weakening housing demand and reducing overall economic activity. The anticipated increase in costs for imported goods poses a threat to consumer spending and housing affordability, consequently dampening home construction and renovation projects that are key drivers of lumber demand.
In parallel, Canada's economic indicators have shown a significant decrease in exports in February while imports have risen, which has contributed to a trade deficit and sparked concerns regarding a potential slowdown in economic momentum. The strengthened Canadian dollar against the USD adds another layer of complexity, making Canadian lumber more expensive for U.S. buyers and further diminishing demand. Additionally, the prevailing economic uncertainties and weaker conditions in both the U.S. and Canada have led to a reduction in construction activity, alleviating supply pressures and maintaining low demand levels.
The material has been provided by - RobotFX
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