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Cloudy skies early, then partly cloudy this afternoon. High 73F. Winds SSW at 5 to 10 mph..

A clear sky. Low 54F. Winds ESE at 5 to 10 mph.

Vander Griend Lumber Co. is a major building materials supplier in Lynden. (Brent Lindquist/Lynden Tribune)

Vander Griend Lumber Co. is a major building materials supplier in Lynden. (Brent Lindquist/Lynden Tribune)

Cost of a 4-by-8-foot sheet of OSB sheathing goes from $8.50 to around $70 

  HATCOM — Along Northwood Road the city limits sign has moved a few times in recent years, further into the countryside. A farm was sold, the herd is gone, and the buildings are being demolished.

  Hundreds of homes are being built on new roads at what were the edges of the city of Lynden. With inventory low, the buying for existing homes has resulted in bidding wars.

  Those in various parts of the building industry give different takes on what is happening and how it came to this point.

  If you call local retail lumber yards, managers say there is product available. The caveat is the cost. 

  Brent Lenssen at VanderGriend Lumber said at the start of June, “We have been able to scrape together enough material to sell so far. From our perspective, there appears to be just enough lumber, plywood and OSB (Oriented Strand Board) being produced right now to keep our market segment supplied with materials. At this point, if you are willing to pay for it, we are willing and able to sell it to you.  

  “As most people know by now, the prices for lumber, plywood and OSB are significantly higher than they were a year ago,” Lenssen said. “We are trying to communicate with our customer base better and also spend much more time planning for our materials needs in the future than we have done in the past in order to minimize product outages, deal with longer lead times, and manage our customer’s expectations.”

  The builder of a year-long project in Lynden said the price of a 4-by-8-foot sheet of OSB sheathing went from $8.50 each to over $70. A week ago, it was at $66. Lumber costs have essentially quadrupled, he said. 

  On some special-order items, lead times have gone from three weeks to three or four months, Lenssen said.

  This pricing and availability squeeze also extends to other products such as windows, doors, garage doors and metal roofing.  

  Rob Lee, executive officer and governmental affairs director at the Building Industry Association of Whatcom County, recently attended a state conference for construction and responded via phone and email.

  Lee said the increased costs are “definitely having an impact.

  “Most projects will continue to move forward,” Lee said, “but the increase in cost will end up being transferred to the end user — either buyer or renters if it is a large multi-family. I have had some feedback from local, smaller builders. They are going to wait to see if prices come down in the short term, but for the most part it’s full-steam ahead.”

  “Ultimately, it’s not good for the industry or home buyers to have these prices as high as they are,” Lee said. “At some point it could cause a slowdown, but we are not seeing that statewide at this point.” 

  From research, the National Association of Home Builders stated on June 4, “Lumber prices have more than quadrupled since April 2020 and this has caused the price of an average new single-family home to increase by $35,872. Skyrocketing lumber prices have added nearly $13,000 to the market value of an average new multi-family home, which translates into households paying $119 a month more to rent a new apartment.”

   Many mills reduced production in spring 2020 due to stay-at-home orders and social distancing measures enacted by state and local governments at the start of the coronavirus pandemic. In the same time, many homeowners decided to focus on do-it-yourself projects as they stayed at home.

   During the U.S.-Canada border closure to non-essential travel, trucks have continued to bring lumber and other products into the U.S. market. However, Lee and the NAHB said the extreme lumber price volatility has been exacerbated by tariffs on Canadian lumber imports into the U.S.

  “These sharp increases threaten housing affordability and the strength of the housing sector, which is leading the nation’s economic recovery,” NAHB said. The organization seeks prompt action from the Biden administration and lawmakers and calls on domestic lumber producers to ramp up production to ease the shortages, and make it a priority to work with Canada on a new softwood lumber agreement.

  Other factors in play in Washington state in particular are: the move to a new energy code in 2018, adding to the cost of building a home; and a general shortage of buildable land/lots and costs associated with buying and developing lots.

Great Western Lumber: Not enough logs, workers to ramp up

  EVERSON — Gerry Millman is the third generation of Millmans to be involved in the Great Western Lumber Company on Goodwin Road since it was founded in 1951. The business has gone from Robert to his son Bob and now to Gerry.

  Millman tries to bring issues into focus by constantly reading articles on the situation in his industy. In short, he says, there is huge demand for lumber and a short supply of it. “The last 12 months, the supply can’t keep up.”

  His mill has approximately 48 full-time workers on one shift. While the huge demand could cause him to rethink adding workers or shifts, it isn’t feasible right now.

  While most people see just the present, Millman looks back more than a decade to impacts of the Great Recession of 2008-09 on the national economy. Businesses including saw mills responded by  cutting back on crews and production.

  Not only were saw mills producing less product, but fewer homes — both single-family residences and multi-family units of condos or apartments — were being built in general. Prior to 2008 and the recession, housing starts were at 1.5 million, he said. Around 2009, housing starts dropped substantially to 500,000. It has taken 13 years to get back to the initial 1.5 million where things are now.

  “We are 4 million housing starts short,” he said, of the years of underproduction catching up.

  Millman separates the demand arising from “the Do-It-Yourselfer with a pick-up truck” — also known as “repair and remodel” or “cash and carry,” doing remodels and building decks and fences — from contractors building entire projects.

  How did COVID-19 play into this? Millman said that with more workers going from office settings to their homes, they started to rethink their home environments. Or some who lived in cities wanted to leave, and now could do so and keep their employment.

  Great Western sources its timber primarily from Whatcom, Skagit and even Island counties, and product goes to customers both regioinally on the West Coast and even further in the U.S. As for lumber coming in from British Columbia, Millman said, the forests there had an infestation of a red pine beetle, causing many trees to die. Loggers hurried to harvest those dead and dying trees en masse, requiring much replanting.

  Millman said it takes 20 to 30 years for new-planted trees to be ready to harvest, which means a lack of logs until then. Also, in the U.S. during the Clinton administration many federal forests placed restrictions on logging, he said.

  According to a news release by Canadian Forest Industries in June 2019 with additional updates in January 2020, there have been nine sawmill closures in British Columbia. Another lengthy list was of mills that had reduced production.

  As to ramping up production to meet demand, Millman said it’s not feasible for Great Western right now. He got to the point of “not enough logs and also not enough workers to add shifts — we are struggling to add employees.”

  He sees lumber prices possibly starting to level off and drop, but it won’t be to pre-2021 levels. “The industry will eventually correct itself.”

  New mills can’t be built overnight, although ones are scheduled to be built in the southern part of the  United States in the next two or three years.