Business, Contracting, Markets 28 The Mainline Early-2025 Market Factors Begin Favoring Lumber and Plywood American International Forest Products (AIFP) provided a snapshot of shifting lumber markets on January 10 in its ‘Lumber Connection’ podcast. Economic changes in recent months favorably- effect U.S. lumber and structural building markets. Factors that have begun to favor improved demand for Oregon structural wood, include: pending pro-business Trump Administration, tariff and B.C. supply impacts slowing imports, destructive weather/wildfire events (hurricanes, LA fires, etc.), supply declines precede rising buying, still-strong jobs economy, pent-up housing demand, builder preference for fir products, and stable interest rates to spur housing. https://soundcloud.com/lumber- connection/january-10-2025 November Housing Permits Surpass Starts U.S. housing starts were at a seasonally- adjusted annual rate of 1.289 million units in November, 2% under October’s rate, and 15% below the November 2023 figure, according to the U.S. Census Bureau and HUD Dept. Favoring a better outlook, November’s U.S. building permits rose 6% above the October report, at a seasonally-adjusted annual rate of 1.505 million units/year, and were the same as the prior year’s November 2023 permit rate. December’s U.S. home builder optimism for single-family home demand was unchanged from the prior month, at a score of 46, according to the National Assoc. of Home Builders (NAHB)/Wells Fargo Housing Index (HMI). The HMI survey asks builders to rate market conditions for new home sales in the next six months. An HMI score over 50 indicates that more builders view conditions as “good.” Mortgage Rates Unimproved from Fed Cuts The Federal Reserve on December 18 issued its third rate cut since September, reducing its benchmark federal funds rate by 0.25%, to a range of 4.25 to 4.50%. While any Fed reduction typically generates borrower optimism, connection between Fed policy and mortgage rates is complex, and the December cut did not lower mortgage rates. Financial markets and lenders are critical of the Fed’s three autumn cuts, and likely had already baked-in Fed actions into mortgage rates. The average 30-year mortgage rate on January 12 rose to 7.05%, the highest since early-July—a small jump that housing experts hope begins a period of stability. B.C. Timber Output Declines A situation that will benefit Oregon timber producers, British Columbia since 2020 has seen closure of 16 sawmills, three pulp mills and four paper Oregon Market Spotlight Monthly Report About Wood Product Markets, Which Affect Demand for Oregon Timber Harvest ›By Rex Storm, Executive Vice President
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