FX.co ★ Lumber Drops Below $600

Lumber futures fell below $600 per thousand board feet as a cooling North American housing market and rising financing costs outweighed persistent supply constraints. The downside was driven by a 5.4% drop in building permits and a steep 14.2% decline in single-family housing starts, signaling softer construction activity just as the spring building season began. At the same time, 30-year fixed mortgage rates rose to 6.22% after the Federal Reserve left interest rates unchanged. The market also faced additional pressure from a sharp decline in crude oil prices, which reduced energy-intensive transport and production costs. Together, these forces effectively offset the modest one-point increase in the NAHB Housing Market Index to 38, while 37% of builders resorted to significant price discounts to clear a 2.4% rise in unsold inventory. Even so, structural supply constraints—such as combined duties of 45% on Canadian softwood and ongoing sawmill closures—continue to provide a price floor.