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Writer's pictureDon Magruder

September 2024 Lumber & Commodity Report


By Don Magruder


The RoMac Building Supply Wood Commodity Index (Index) for September increased 2.6 percent to $408.56 per thousand as mill curtailments and closures persisted while the housing market struggled to build momentum. The decision by the Federal Reserve over the next week will determine if the housing market in the United States can finally see some relief from the higher interest rate cycle which should bring buyers off the sidelines.  


The lumber portion of the Index increased 2.8 percent to $436.71 as across-the-board pricing firmed and mills struggled to balance production with demand.  Studs were up $5 to $15 per thousand while 2x4 dimensional spruce traded from down $4 for 14’ lengths to up $25 for 10’ lengths. 2x6 spruce traded the highest on the Index by adding almost 8 percent. 2x4 pine was up almost 2 percent while 2x12 pine was flat in all lengths but 16’ lengths which added $25 per thousand.  Most items on the Index were up and demonstrated a market trying to balance the supply equation.


The sheathing portion of the Index added 2.4 percent to $387.53 as CDX pine continues to show pricing strengths on tighter supply on a pullback from importers in South America.  15/32” CDX added 5.4 percent while 19/32” CDX jumped 8.6 percent, and this is with a very slow hurricane season thus far which has surprised many. OSB sheathing was flat as mills maintained current pricing while balancing inventories. The sentiment by many is that mills are growing less likely to drop pricing further and continue to deteriorate their bottom lines.  Mill curtailments seem the best solution to maintaining prices in a wait-and-see market.  


If the Federal Reserve does chart a course this month of lowering interest rates, which results in a general increase in housing demand, expect pricing to firm and improve.  Over the last couple of years during this housing slowdown, mill capacity has not expanded to handle significantly improved housing demand, and some would argue not much has improved in supply expansion since the pandemic.  Builders should consider this as they look at projects in the spring.


These markets and builders truly need a continued quiet hurricane season, and this along with a Federal Reserve drop in interest rates just might be the catalyst to kick off another run in home building.  Let’s hope so.  


The RoMac Wood Commodity Index is a weighted lumber and sheathing composite based on usage in Central Florida. By using wholesale pricing, the Index is a good indicator of the pricing direction for the next 30 days.


Don Magruder is the Chief Executive Officer of RoMac Building Supply in Central Florida, he is a former president of the Southeast Mississippi Home Builders Association and a past Associate Vice President of the Home Builders Association of Lake County.


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