Lumber Market Update - April 2021 | Shepley Wood Products
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Lumber Market Update - April 2021

Unabated demand and inadequate supplies continued to plague the industry in March, further pushing prices in to new historical heights. However, as the month wore on and the threats and effects of winter snowstorms dissipated, so did the sense of urgency of dealers, who were growing more satisfied with what they had purchased for their spring needs. The slight retraction in buying had a cooling effect on the lumber market, causing pricing to finally plateau (but hold fast in record territory, nonetheless). The exception was plywood, which ratcheted up even higher amidst a resin shortage due to winter storm damage in Texas, where several resin plants are based. With peak “building season” at hand and weather improving every week, we are at a critical point in our market. Lead times are long and readily available lumber is scarce, so it is yet to be determined if there will be another major round of buying before summer hits or if lumber buyers will be able to pick off their needs in a more casual manner. Needs aside, we have also reached a high point in pricing where no one wants to actively buy anything that they don’t have to. And although the laws of supply and demand in a free market dictate otherwise, justifying the prices of today’s lumber is asking for an argument. Exorbitantly high costs are cooling the urge to spend. Rumors are beginning to spread of a developing trend in other areas of the country where, as we saw towards the end of last fall’s rally, contractors and potential homeowners are again making the hard decision to step back and wait for the market to retract. As of print, the market is still firm, but traders are actively testing out buyers as to what level an offer must be at in order to earn an order. For April, we anticipate that pricing will be firm and likely hold fast (as, in all likelihood, buyers will jump back in to fill some of their needs), but cracks may develop. It is still a volatile market, so we suggest that you keep in close contact with your Shepley sales person regarding current and upcoming jobs.

We often meet with sales people who have a keen interest in our business, and a common question they ask in order to gain a better perspective of Shepley is “What is most important to you for your business?” For the most part, their focus is typically product-driven, in that they are trying to lure in business with the enticement of offering something that is exceptional for its category, aggressively priced or generally unique and different. However, unless your supplier is able to provide you with a quality item that is competitively priced and backed by superlative service (on-time, in-full deliveries, for example), what is important to you (getting the job done right, on time, and within budget) takes a backseat to dealing with whatever will crop up from material issues, late deliveries, or generally poor service. In our experience, it is common for organizations to claim high standards, but it is very rare for organizations to meet high standards. New suppliers come and go and, a lot of the time, they are able to enjoy some business as they work to prove their mettle. However, unless the directive for a quality offering and exceptional customer service is enforced from company leadership and subsequently becomes part of their culture (for long-lasting results), there is little foundation to grow upon. Without this foundation, they’ll typically resort to the path of least resistance: low pricing (of which, we all know, cannot be sustained for the long term). Aligning with exceptional suppliers is an important key to success and one that we put a tremendous amount of effort in to. When we are asked what is most important to us for our business, it’s a relatively easy answer. It’s to align with a supplier who has the same high standards as us and who understands the importance of delivering exceptional quality and service at competitive pricing. Anything short of that, we know, will prevent us from meeting our goals and that is just simply unacceptable.

We thank you for being our customer and, if you are new to Shepley, we hope that we can prove to you that we are the building material supplier that you want to use towards your future success. We fight for our livelihood every day and welcome the opportunity to prove to you that we are the building material supplier you want to be using for your project. Thank you for your past, present, and future business!