This is a question that probably is asked several thousand times a second in the lumber business. No matter whether the customer is buying hardwood, softwood, plywood, or even a milled wood product, it all comes down to, “How much will it cost?” I think the lumber industry has developed a bad reputation for keeping its cards too close to the vest on price, much to the chagrin of its customers. I can’t tell you how many times I have walked into a lumber yard with no idea of how much I was going to have to shell out for my order. Oftentimes there is no price list posted, and when I have asked for one, the answer is never quickly forthcoming. Usually the response is “What are you looking for?” At which point I’m given a price only for the species, thickness, and width I mention. What’s more frustrating is that when I go back a few days later, armed with my price and the board footage I need, at checkout my total is more than I expected. It is then I come to find out that the price has changed (usually gone up) in 48 hours. I pay my money and leave, feeling vaguely as if I have gotten the short end of a deal.
My experience can be reproduced thousands of times over with anyone who has ever bought lumber regardless of whether it was 1 stick or a truckload of material. Unfortunately, it results in an adversarial relationship between the lumber yard and its customers, which is borne from centuries of this kind of dynamic pricing. Personally, I hate this and strive to draw back the curtains on our operation at J. Gibson McIlvain, so our customers know we are working with them, not against them. Read any of the articles on this site, and you will find a company striving to inform and explain the behind-the-scenes of the lumber industry. So, if you call us or visit our yards in Maryland and Connecticut and ask for a price, we will give you a straightforward answer.
Frustrated yet? This is the rub, “It depends” is usually as straightforward an answer as one can give when it comes to lumber, millwork, decking, or even plywood. The issue lies not with a shady dealer who is trying to gouge customers but in the fact that there are so many variables that affect the seller’s cost on the material.
Grade and Mixed Grade Packs
I think most of us are aware that a completely defect free board with no sapwood is going to be more expensive than a board full of knots and worm holes. But do we ask for our lumber by grade? In my experience, we ask by species first and rarely if ever mention grade. Perhaps that is caused by a lack of understanding from the consumer on lumber grades, or it is just assumed that only the best grade will be acceptable. The current grading structures are often too vague, and frequently FAS isn’t good enough for millwork and applications where long and clear boards are needed. Moreover, we don’t buy a container of FAS Cherry or Mahogany and get 100% FAS in it. There is always a percentage of lower grade material that brings down the curve and which can inflate the cost of the whole pack. Most lumber dealers won’t inflate the price on this material at the outset, but as the shipment is picked over and less and less top quality lumber remains, you will find the price rising in order to cover the cost of that mostly unsellable material. Some lumber yards still stock Common grade lumber, but that is becoming more of a rarity; the market typically won’t tolerate the Common grade lumber, so the material sits and sits until it is written off for a loss. Thus, depending on the quality of the material you buy, the price is going to fluctuate.
Length and Width Specifications
Similar to grade, the actual specs you require for your boards will change the price. It is no secret that wider and longer boards are harder to come by these days, so these boards will always be at a premium. In some instances with exotic material, the wider boards are available, but the demand is so low that the mills actually rip them into narrower strips to meet the typical 6-8″ width. In order to get wider boards than this, we have to specifically request it from the mill, and the entire shipment is cut to that specification. This changes our cost dramatically, and the larger volume with slower turn on the yard presents a greater risk to the dealer, so the price per board foot will rise to offset that risk. This price change will also fluctuate depending on the species you request. Wide Walnut is worth its weight in gold these days, just because of how the tree grows, whereas wide Maple or Oak will have a barely noticeable price change. Length is the same but to a lesser extent, until you get into really long boards above 14′, and even more so when the length spec climbs into the 20′ range. Just remember that lumber is an organic product and not manufactured. We can’t just make it wider, so when your specification absolutely requires it, the price will reflect it. “Wide” is a relative term, but as a general rule of thumb, if it falls above the 6-8″ range (except Walnut where 6″ is wide) your price will be higher.
The time of year you buy lumber will change the price too. Sometimes it is due to supply and demand. If you try to buy decking products in the middle of summer, you can expect a higher price, because everyone is buying and the lumber yard stocks are starting to dwindle. Think of it like this: Christmas wrap and lights are always much cheaper on December 26th. Buy your lumber off season, and you can sometimes expect a better price. Unfortunately, it can also swing the other way, and you may end up paying more off season due to lack of availability. Ipe decking is a great example of this, because it is harvested and shipped to work around the Brazilian rainy season. Most importers can only take shipments in the winter months. If you buy then, you will find dealers who are struggling to make room for an entire year’s worth of Ipe, and they are more willing to sell it at a lower price. At the same time, if the actual harvest and sawing of the lumber is harder because of a rainy season or a harsh winter, then the price downstream will be higher as well. As costs due to increased overhead rise, so too does the sale price rise. And as the risk rises due to a dealer taking on stock well in advance of the buying season due to seasonal shipping demands, so also does the sale price rise.
Where your lumber comes from will dramatically affect the price it sells for at the lumber yard. It probably goes without saying that Teak which comes from the other side of the world will be expensive just due to the distance it travels, but what isn’t common knowledge is how cost can fluctuate within the same species due to its wide growth range. A lot of African lumber faces this problem as it grows from one side of the continent to the other. Depending on whom you buy from and how deep they are into their forest concession, the distance lumber travels increases and the number of countries it crosses grows. Many of those countries in Africa through which the lumber passes are in the middle of civil wars which produce hazardous shipping conditions. The political climate of the regions can greatly affect the price and usually causes fluctuations from one shipment to the other. So you may get a price on Sapele or African Mahogany one day and get a different one the next day, because the lumber for which you were originally quoted has now sold and new material with a different cost has taken its place.
Regulation and Import/Export Fees
For exotic materials there are a lot of behind-the-scenes charges to bring the material in to the country. Some of them are very tangible like shipping costs, CITES paperwork, and demurrage at the port. Certified lumber carries a much higher cost, because of the many requirements placed on that lumber and the severely reduced supply. Some of these charges are very intangible like the diligence required to ensure legal lumber and Lacy Act compliance. This diligence can come in the form of continual visits abroad to meet with sawmills and visit concessions to ensure sustainable practices and verification and legality. The companies we choose to buy from abroad can supply us with a continuous supply of lumber despite news of shortages and increased regulation, because of the companies’ long history in sustainable forestry. When other mills close due to government shutdown and a lack of business, our vetted suppliers continue to do business, thus affirming our diligence. With this comes cost. We could buy material cheaper abroad, but we cannot be sure that it is being harvested legally nor can we ensure that we will be able to continue to obtain it. Cheaper lumber will always be available, but the buyer needs to ask themselves if it is worth the uncertainty and possible downstream prosecution under violation of the Lacey Act.
If you have the lumber delivered, it is fair to expect a charge for that. But how is that fee levied? Because we run our own fleet of trucks, we have more control over the costs, so we technically don’t charge a shipping fee. Instead, we work those fees into the overhead, and it will be reflected in your lumber price. If the buyer is confronted with a significantly lower price somewhere else, and all the other variables are the same, it is safe to say that the shipping fees haven’t been added on yet. Common carrier shipping will raise the price even more, and the uncertainty rises as to what condition the lumber will be in when it arrives at the destination; uncertainty also exists whether the driver will be willing to help you with unloading the lumber. Even then, if you need your material delivered to a job site that isn’t tractor trailer accessible, then the shipping company will need to deliver on a smaller, specialty truck, and additional unloading and loading at the distribution point is needed. As you can imagine, all of this will add more to the cost of the lumber.
Size of Order
Finally, the price of your lumber will vary depending on how much you buy. It is widely known that wholesale pricing is lower than retail, but there isn’t a clear line that defines where retail ends and wholesale begins. This will vary from one supplier to another. The principle here is that it takes the same amount of labor to pull 100 board feet as it does 1000 board feet, especially once you throw a forklift into the mix. In reality, a smaller order takes even more labor and paperwork, as the larger pack needs to be broken in inventory and re-tallied. Also, when part of pack is removed, the remainder loses value, especially if it gets picked over enough, leaving behind the less than perfect material. These broken packs tend to get pushed to the back of the sheds as full packs are pulled for wholesale orders, so that when that smaller order comes in, 10 or more packs need to be moved just to get to it. Suddenly, your quick retail order takes 30 minutes just to find and pull. All of this is overhead, and it eventually adds to the final price of the lumber.
These elements cover much of what is happening behind the scenes at your lumber dealer, but it can’t cover it all. The point being that there are so many variables that go into the board foot or linear foot price of your material, that is is impossible to answer the “How much will this cost” question without saying…
I’m sorry to add to the frustration, but I can tell you if you go to your lumber dealer prepared with what you need and how you want to use it, we can help you find the right species, grade, length/width spec, quantity, certification, and ship it right to your door. Then we can give you a price. Until we have all those details, it is a best guess game on price. I guess the better question should be:
“What are the factors that will affect the price of the lumber on my order?”
Now we’re talking, and we can begin a true conversation to get you the best material, when you want it, at the best price.