No windfall for plywood industry

Hurricanes battering Florida’s coast haven’t led to a spike in plywood prices this year. In fact, prices for plywood are actually on the decline.

“In the past, we’ve seen hurricanes dramatically impact the price of panel products,” said Shawn Church, editor of Random Lengths, a Eugene, Ore., newsletter that reports on the wood products industry. This year, “it’s had almost no effect at all.”

Hurricane season coincides with the end of summer building activity, and the timing often leads to a run-up in plywood prices, Church said. Inventories typically are low when Gulf Coast homeowners descend on retail lumber yards, buying up plywood and other panel products to protect their windows from high winds. The sudden demand produces regional shortages and national price hikes.

This year, however, plywood inventories remain high. One of the busiest home-building seasons on record kept mills running at more than 90 percent of capacity through the end of the summer, Church said. No shortages have emerged.

That’s good news for local homebuilders – particularly since hurricane season lasts another two months.

Builders have paid record prices for plywood and its competitor, oriented strand board, over the past 12 months. The higher costs have been passed on to consumers in the form of higher home prices.

Random Lengths tracks plywood and OSB prices through a structural panel composite price. Last year at this time, the composite price was $552 per thousand square feet. This week, the composite price dropped to $436 per thousand square feet.