FX.co ★ Lumber Eases from 3-Month High

Lumber futures have subtly declined to approximately $610 per thousand board feet, after reaching a three-month peak of $627 on June 30th. This adjustment is largely due to an oversupply meeting decreased demand in a North American housing market that is losing momentum. In May, the initiation of single-family homes in the US was down by 7% compared to the previous year, with homebuilder confidence dwindling against the backdrop of rising mortgage rates. The typical summer slowdown has arrived ahead of schedule, causing builders to adopt just-in-time purchasing strategies and delay orders in anticipation of US tariffs on Canadian softwood, instead of shouldering heightened costs. However, the downturn has been somewhat mitigated by production cuts at smaller Eastern mills, a shortage of logs in the Southeast due to severe weather conditions, and consistent export demand from Asia, which has tightened the supply of certain dimension and specialty lumber grades.