Why are Lumber Prices so High?

Whether you are building a house, making furniture or putting trim around your home, there is one commodity that is essential: lumber. Unfortunately, lumber doesn't come cheap. Over the years the cost of lumber has risen. Like most issues, the price of lumber is a complicated one, involving many factors that play into each other.

• Law of supply and demand: This is a basic principal of economics. As supply goes down, price goes up. Likewise, as demand goes up, prices goes down.


• International Regulations on Logging Practices: There are more regulations on businesses across the world now than have ever existed in the past. This is a good thing as it protects the rights of workers and the people who live around the logging industry. However, these regulations do make it trickier and more expensive for those who run the logging industries, thus making it more expensive for the consumer.


• Stricter pollution laws: The environment has become increasingly important to citizens around the world. Lawmakers have taken note, protecting resources with strict air and other pollution laws. Again, these laws are good, but have a tendency to make it expensive to run certain industries. For example, there is now a law protecting the habitat of the endangered spotted owl. Good news for the owl; expensive news for the consumer as the owl lives in prime logging territory. The companies that might have worked locally are now having to move their business elsewhere, adding expense. This also plays into the law of supply and demand. The supply has just decreased in this example.


• Import and export taxation: Certain types of wood are not harvested in the United States. That makes a difference because as the wood is important from foreign countries, there is the added expense of taxes as it crosses the border.