Skyrocketing Lumber and Panel Costs Have Failed to Trickle Down to Forest Landowners

A Federal Reserve Board report reveals that the price index of lumber and wood products almost doubled from April 2020 to February 2021 — the sharpest rise since 1946, when the post-World War II housing boom kicked in. Any trip to your local lumber store will confirm that prices are spiking. However, according to Jason Stock, executive director of the New Hampshire Timberland Owners Association, “Not much of this has translated back to stumpage or standing timber. We’ve seen some slight increase but haven’t seen the type of price growth that lumber has seen.” So why aren’t the trees in New Hampshire forestland suddenly worth twice as much? The real obstacle for landowners cashing in is that trees can’t get a piece of the action until they are sawed. The decline of paper mills and wood-fired electricity plants has also undermined the economics of cutting down trees. The number one problem, according to Stock, “Is that much of southern and central New Hampshire consists of hardwood forests, whereas the bulk of the construction industry uses faster-growing softwoods such as pine, spruce or fir. Those softwood species become more common in northern parts of the state.” Stock went onto say “Hardwood has been a different story concerning lumber demand. China is hands-down the No. 1 consumer of northern red oak, the most significant hardwood product grown in New Hampshire. The trade war with China has been a problem. … We have started to see kind of a steady recovery and a modest increase in hardwood lumber markets, but nothing great.”