Wood demand spikes as inventory slips due to COVID-19
The past few years, Britt Raburn, owner of Lyndhurst Lumber Inc. in Lyndhurst, had wondered what became of do-it-yourselfers.
In the meantime, he increasingly focused on contractors and the company doing projects itself. But about six weeks ago, the DIY market came back. Suddenly.
“That’s when the phone started ringing off the hook with people looking for lumber,” Raburn said, as eager homeowners stuck at home decided it would be a good time to add a new deck and the big-box stores had run out of pressure treated wood. It became a national phenomenon as precautions for the COVID-19 pandemic sent office workers and others home to prevent the spread of the disease.
“We went from a few DIY customers to 50 to 100 a day,” Raburn said. “I was fortunate to have a couple trucks come in. Usually it takes a month to sell a truck, but we’ve been doing that in four hours some days.”
While the uptick is good for sales, Raburn and others say the situation is different from other material shortages that afflict the building business every few years.
“In a hurricane or a fire, it raises a little havoc in one part of the country,” Raburn said. “This is different. It’s everywhere. The mills can’t crank up machines when no one is there (due to plant closings) to crank them.”
Other factors compounded the impact of DIY demand on an already bustling construction market. Truck shipments became erratic as drivers cut down trips because of concerns about getting fuel and finding places to stop on the way.
Meanwhile, lumber prices shot up 18%, according to wood data from the Association of General Contractors, a Washington, D.C.-based trade group. However, that price of wood may be offset by other factors to take the sting out of it, primarily low interest rates that allow higher prices to be paid over time. Wood is considered about 20% of the cost of a new house.
The situation is similar on the West Side, where Avi Selva, sales and marketing manager of Cleveland Lumber Co., said that the company’s racks were not as full as he likes them to be.
“It’s a perfect storm,” Selva said. “Demand for treated wood exploded because of the demand from do-it-yourselfers. The industry was not ready for it on top of mills shutting down due to COVID-19. It seemed like overnight we went from getting an order in three or four business days to four or five weeks. All you can do is take a number and stand in line.”
Treated wood is typically yellow pine, prized for durability where it touches the ground, although sometimes cedar may be substituted for it, experts say. The shortage does not grip hardwoods, such as oaks, that are used in furniture.
Brenda Callaghan, executive director of the HBA of Greater Cleveland trade group for homebuilders, said homebuilding experts don’t expect the treated lumber shortage and price increases to work themselves out for some time.
“Builders and remodelers started out with a very busy year, then everything stopped a few weeks when COVID-19 hit,” she said. “But now everyone says it is busier than before the state lockdowns of other industries.”
Slowdowns in delivery of everything from cabinets to appliances stemming from plant closings have continued to challenge builders, she said.
“With the new rules for social distancing, it’s taking longer to even hang a door,” Callaghan said. “Some delays in finishing houses are stretching from a week to several weeks.”
Jack Dever, owner of Dever Design & Build in Willoughby for 30 years, said suppliers are having a particularly hard time finding 4×4 treated lumber because those pieces are central to the rest of a project like a deck. Even door hardware has become scarce because many of the components are made in China, he said.
All those factors, along with price increases, make it hard for the customer builder and remodeler to conduct business as usual.
“Getting repairs is also more difficult,” Dever said. “I had a job where a couple cabinet drawers were damaged. Rather than have them in 24 hours, we had to wait two weeks for them. It delayed closing out the job. Prices are also in so much flux that I can’t hold estimates long. They used to be good for a month; now it’s a week.”
Supplies are so fickle, Dever said, that rather than ordering wood, cabinets or other materials about when he will need them, he orders them as soon as the contract is signed.
Although steadily increasing prices may raise concern going forward, Dever said he has been heartened by the volume of work that has materialized since the state ended its shutdown orders for the general population.
“I’ve never seen anything like this before,” Dever said. “It’s like it’s something new every week. But there is only one way to handle it. We have to just muscle through it.”