Lumber Pricing, Demystified (Part 2)

In our effort to educate our customers about lumber pricing, we’ve begun the conversation by discussing the need for dynamic pricing, to begin with. Now we’ll look at a few more factors that influence lumber pricing. Whether you like it or not, our hope is that by the end of this series, you’ll have a better understanding of how we get the numbers that we do as well as how to strategically purchase the lumber you need so that you can save yourself and your customers valuable money and time.

Length and Width

In addition to grade and timing, board size is a huge variable in pricing. Of course, long and wide boards are getting more and more difficult to attain, so those boards will be priced higher to account for the low supply and high demand. “Wide” is a term usually used to designate anything beyond the 6-8-inch range. Sometimes, particularly with exotic hardwood species, wide boards are highly available, but the low demand for them leads to mills ripping them into narrower strips. While lumber suppliers can request the wider boards, by doing so, they take a risk and therefore need to price the boards in a way that offsets that risk.

Seasonal Demand Issues

In our previous post on this topic, we mentioned the general reasoning behind the dynamic, ever-changing pricing structure for lumber, as well as the reason lumber picked from a pack that’s almost empty will cost more than identical lumber picked from the same pack, early on.

Now we’ll consider in a bit more detail how timing can affect lumber pricing. Some of it is tied to the principle of supply and demand: Just as Valentine’s Day candy will be in higher demand — and therefore cost more — before the holiday than after, decking lumber is usually in higher demand in May than it is in November — or March, for that matter.

Seasonal Supply Issues

When it comes to decking lumber, there’s an additional factor that may be even more significant than demand — and that’s supply. Ipe decking, in particular, is only harvested during certain times of the year, so U.S. suppliers receive their entire year’s supply of Ipe during the winter and early spring months. If you make your Ipe purchase in spring, when large volumes of Ipe are overrunning an Ipe importer’s lumber yard and most people aren’t ready to shop for decking lumber yet, you’re likely to get a great deal.

During the summer months, the same decking lumber will be in higher demand but experiencing waning supply. The later it gets in the season, the more likely it will be that the dealer will need to assemble your order from several different packs, increasing their overhead expenses. Of course, that increase in expense will translate into a higher price for you, as well.

To learn about more variables that affect lumber pricing, continue reading with our next post (coming soon).

Learn More About the Lumber Industry

• Understanding the Organic, Ever-Moving Nature of Wood
• Lumber Grading Anomalies: Ebony, Guitars, and B Grade
• Constantly Shifting Grading Standards for Plywood and Millwork

J. Gibson McIlvain Company

Since 1798, when Hugh McIlvain established a lumber business near Philadelphia, the McIlvain family has been immersed in the premium import and domestic lumber industry. With its headquarters located just outside of Baltimore, the J. Gibson McIlvain Company (www.mcilvain.com) is one of the largest U.S. importers of exotic woods.

As an active supporter of sustainable lumber practices, the J. Gibson McIlvain Company has provided fine lumber for notable projects throughout the world, including the White House, Capitol building, Supreme Court, and the Smithsonian museums.

Contact a representative at J. Gibson McIlvain today by calling (800) 638-9100.