New construction boosts timber prices

01/07/2009

The state of Oregon has reported that the price of timber is beginning to increase after a period of falling prices, suggesting the industry in the region is set for recovery.

The prices for logs and mill studs has increased from $140 per 1,000 board feet to around $160 per 1,000 board feet, according to the industry.

One reason given for the price increase is the fact that more new home permits have been granted. More people are building houses because interest rates are low, says Homes Ownership Counsellor, Lynn Tribon.

Tribon says there has been a 3 per cent increase in the number of people interested in building houses since last year, while sales were also up 10%. She says, "that activity stems from the first time home buyer to retirees. It's completely across the board as to who's looking for what.”

David Schott from South Oregon Timber Industries Association says he expects around 700,000 new homes to be built over the next year, followed by as many as 900,000 ‘starts’ the year after. This is good news for timber prices as 50-60 per cent of timber is used in new construction.