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Softwood plummets 50 per cent: Good news for buyers
Propurchaser
In mid-May, the price of two-by-fours fell to US $224 per thousand board feet, about half the cost of three years ago. In Canadian dollars, the drop was closer to 60 per cent, with the loonie flying at a 30-year high. Prices did increase toward the end of the month, however.
Dozens of Canadian mills have closed or reduced operations and thousands of workers have lost their jobs over the past two years as the industry has struggled with a stronger Canadian dollar, low prices, and a dramatic tumble in US housing starts. About half of all Canadian production is exported to the US.
Though the prices of mid-May were good news for buyers, even then, the situation wasn’t expected to continue indefinitely, according to a recent report from the Conference Board of Canada.
“What we’re seeing is both production and employment bottoming out in the second half of 2007,” said Michael Burt, the report’s author. He expects a gradual recovery in US housing starts next year, barring tighter lending controls.
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