Last month, the word was “uncertainty.” This month, the new word is “supply.” In the last 30 days, the United States has been clobbered by two major hurricanes—the first since 2005. The market is in disarray as it tries to figure out the long-term impact of rebuilding versus business lost as well as the overall health and direction of the country’s housing market. During major weather events, such as Hurricane Harvey and Hurricane Irma, trucking and manufacturing delays can play havoc on supply, which is exacerbating an already dysfunctional supply chain.
The Ro-Mac Lumber & Supply, Inc. Whole House Commodity Index increased a modest 0.1 percent to $32,453, as robust declines in the sheathing markets were offset by declines in drywall and spruce studs. As the repairs from these two hurricanes ramp up, expect pricing and supply on many items to become spottier. The supply chain is about to be tested, since being decimated by the Great Recession.
Please find below the notable price movers in the Index over the last month:
Unless housing eases more than expected over the next couple of months, pricing should remain firm with the focus on longer lead times due to production and trucking issues. Dealers and builders will have to get adjusted to longer lead times for many commodities, especially items like doors, windows, and specialty roofing. It is imperative that builders push their customers to make product decisions much sooner in the decision-making process. Lead times and availability in products as well as labor could very well be the biggest problems through the end of the year—not price.
Don Magruder is the Chief Executive Officer of Ro-Mac Lumber & Supply, Inc. in Central Florida. Go to www.romaclumber.com to sign-up for the Index and other free market reports. To sign-up for this information via email, contact Rebecca Ballash at