After sharp decline, lumber prices rising again due to B.C. wildfires

Vancouver -

Lumber prices have been on a wild ride over the last few months, and the wildfires currently burning across British Columbia have started to contribute to that volatility.

It's not that the fires are burning up logs that might otherwise be headed to market. Rather, wildfires have closed rail lines that mills use to transport their products from the Interior to the Port of Vancouver for export, explained John Innes, dean of UBC's Faculty of Forestry.

"The mills all have fairly large inventories of logs right now, and they could be exporting into the U.S. if they could, but the problem that they've got is actually the transport," Innes told CTV News Vancouver.

Both CP and CN rail lines have been affected by the wildfires, Innes said, adding that the transportation issues have reduced supply and caused prices to tick up in recent days.

The price of 1,000 board-feet of lumber had been falling steadily since hitting a peak of $1,686 on May 7. As of July 15, it had dropped to just $490, according to Innes.

This week, however, the price has begun to rise again, hitting $648.

"That's a fairly significant increase since the 15th of July," Innes said.

The UBC professor said prices "went pretty crazy" in May, and aren't likely to reach those heights again as a result of the current supply issues.

"Prices have since tumbled because the supply caught up with the demand," Innes said. "Now, there is a fear that over the next month or two, there will be difficulties in maintaining that supply. So that's why prices have gone back up again."

For consumers looking to buy lumber for a home renovation or a similar project, Innes recommends waiting a little while.

"There's always a little bit of a disconnect between the retail price and the wholesale price," he said.

Many retailers still have high-priced products in stock that they purchased a few weeks or months ago, he explained, adding that the recent decline in wholesale prices hasn't been fully passed on to consumers yet.