Lumber costs up 30% in 6 weeks Builders blame rise on proposed logging restrictions in West.

June 25, 1991|By Orlando Sentinel

Despite a recession that has crippled the housing industry, lumber prices have jumped more than 30 percent in the past six weeks, home builders and industry members have said.

The National Association of Home Builders, a trade group based in Washington that represents builders' interests, laid the blame on proposed logging restrictions on millions of acres of forest land in the Pacific northwest and California to protect the habitat of the northern spotted owl.

That has sent timber buyers scrambling to buy supplies to protect themselves from possible shortages, said Mark Ellis Tipton, a Raleigh, N.C., home builder and president of the national builders association.

The surge in lumber prices is particularly disruptive because housing markets just now are beginning to recover from the recession, Tipton said.

Tipton said the timber cost increases will boost the price of a $150,000 house by more than $3,000.

Alan Cordill, manager of Panning Lumber Co. in Kissimmee, Fla., said prices have surged incredibly over a short time span.

"It has been one of the most volatile periods I can remember," he said.

Cordill said three factors likely combined to push up prices -- the logging restrictions to protect the spotted owl, lumber demands in the rebuilding of Kuwait and the closure of some mills during the recession.

Many mills shut down during the recession when demand disappeared, and they have not yet reopened, Cordill said.

Richard Levine, president of American Original Inc., a Longwood, Fla., home-building company, said his suppliers forewarned him of impending increases so he didn't get locked into a contract where increases in material costs would eat up his profit.

But some builders with contracts to build houses for a specific price will be hurt by the lumber cost rise, he added.

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