FX.co ★ Lumber Drops Near 4-Week Lows

Lumber futures have dipped below $590 per thousand board feet, marking a nearly four-week low, as the waning housing demand and the fading momentum from previous restocking efforts take their toll. The demand has diminished partly due to increased financing costs and a slowdown in housing market activities, exemplified by the sharp 9.3% month-on-month decrease in US pending home sales in December 2025. This downturn has led to a reduction in wood consumption linked to construction and renovations just before the spring building season kicks off. Concurrently, mills, in their endeavor to replenish inventories post-winter shortages, have increased the physical supply. Distributors, meanwhile, report a slowdown in new orders. This scenario of declining demand coupled with rising availability has prompted investors to unwind positions following January's rally, exacerbating the drop in prices with decreasing trading volumes and open interest in the market.