Is Lumber Close to a Bottom?

By Andrew Hecht
July 4, 2024
Category: Finance & Economics
Region: Canada, United States

In a June 4 Barchart article, I asked if lumber prices were stuck in neutral, concluding: Lumber prices are stuck in neutral, for now. When they decide to move, watch out, as another period of explosive and implosive price action will likely follow. On July 3, nearby September physical lumber futures were below the $490 per 1,000 board feet level. Physical lumber futures on the Chicago Mercantile Exchange declined by 22.99% in Q2 and were 21.24% lower than the 2023 closing level at the end of June. …While I have never traded one lumber contract, lumber is very attractive at the current price level. I favor the upside but would leave plenty of room to add on further declines as prices could fall to irrational, illogical, and unreasonable levels as the bearish trend continues. 

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