As Lumber Prices Fall, the Threat of Inflation Loses Its Bite

Costs soared partly because of do-it-yourselfers’ spending stimulus checks, but a month of declines show that consumers aren’t about to trigger runaway increases.

From sawmills to store shelves to your own hammer swings, lumber can tell you a lot about what’s going on in the economy right now. Lumber prices soared over the past year, frustrating would-be pandemic do-it-yourselfers, jacking up the costs of new homes and serving as a compelling talking point in the debate over whether government stimulus efforts risked the return of 1970s-style inflation. The housing-and-renovation boom drove insatiable demand for lumber, even as the pandemic idled mills that had already been slowed by an anemic construction sector since the 2008 financial crisis. Lumber futures surged to unprecedented heights, peaking at more than $1,600 per thousand board feet in early May.