Lumber prices are spiking this spring as warm weather spurs construction, while softwood lumber trade talks between the United States and Canada show no signs of progress. U.S. trade authorities are still mulling over their options for slapping penalties and taxes on Canadian wood shipments to the United States, Bloomberg reported (see: "U.S. Delays Ruling on Canada Lumber Duties as Dispute Simmers," by Jen Skerritt). From Bloomberg: "The department’s decision on countervailing duties is still expected to be released next week and the two duties combined -- countervailing and antidumping -- will probably be big enough to hurt Canadian producers, said Kevin Mason, managing director of ERA Forest Products Research." Log prices are surging in anticipation of the penalties, The Wall Street Journal reported (see: "Lumber Logs a 12-year high," by Benjamin Parkin). "Traders say Canadian mills are already raising prices to cover what they believe could be duties of between 35% and 55% on lumber they ship to the U.S.," the paper reported.
Homebuyers and builders will be the ones footing the bill, noted Bloomberg (see: "Homebuilders Could Be Losers in Early Test of Trump Trade Policy," by Joe Light). From the report: “There’s a tremendous amount of frustration because of this," said Jerry Carter, a custom home builder and remodeler in Dallas. “It’s similar to the impact if you go to buy gas one day and decide not to buy it when it was three dollars, and then you go back first thing in the morning and it’s four dollars. Except you’re buying $10,000 worth of gas.”
But a lumber industry spokesman downplayed the significance of lumber cost in home production, Bloomberg reported: "'The cost of lumber in an average home is negligible,' said Zoltan van Heyningen, executive director of the U.S. Lumber Coalition, who points out lumber prices are still below the level of several years ago. [Van Heyningen's] group joined with U.S. timber growers, owners and workers to form a group dubbed the Committee Overseeing Action for Lumber International Trade Investigations or Negotiations, or Coalition, to advocate for duties against Canadian wood."
Meanwhile, the White House signaled a new tough line on Canada trade, making headlines in the Canadian media (see: "Strident Trump targets Canadian trade on energy, lumber, dairy files," by Alexander Panetta, the Canadian Press - CTV News Winnipeg; and "Donald Trump slams Canada for trade practices in energy, lumber, and dairy," by Drew Hasselback - The Financial Post). “We can’t let Canada or anybody else take advantage and do what they did to our workers and to our farmers,” Trump said. “And again, I want to also just mention, included in there is lumber — timber — and energy. So we’re going to have to get to the negotiating table with Canada very, very quickly.”
Another sign of spring: collapsing outdoor decks. Last week brought a rash of deck failures that caused injuries — some of them severe. A five-month-old baby was flown to the hospital following a deck failure in Tennessee, reported the Kingsport Times-News (see: "Infant flown to Vanderbilt after six injured in Hawkins deck collapse," by Jeff Bobo). "Stanley Valley Volunteer Fire Department Chief Stacy Vaughan said the second-story deck broke away from the side of the house and fell to the ground while the side of the deck farthest from the house remained up," the paper reported. "Among the six people on the deck at the time were two children, their parents, the infant and an elderly female."
And in Saw Creek, Pennsylvania, 12 youthful partygoers were hurt by a deck failure, according to The Pocono Record (see: "12 injured in Saw Creek deck collapse," by Bill Cameron). The home where the accident occurred is listed on the rental market for short-term gatherings, the paper noted: "Airbnb — an online marketplace for short-term rental lodging — lists the house for a weekend price of $666 per night, with a two-night minimum. The description says the home sleeps 24 guests and has almost 600 square feet of deck."
Coastal flood risks are the topic of long-form deep-dive coverage from The New York Times Magazine and Bloomberg this week (see: "When Rising Seas Transform Risk Into Certainty," by Brooke Jarvis; and "The Nightmare Scenario for Florida’s Coastal Homeowners," by Christopher Flavelle). Both articles focus on financing and markets: "Along parts of the East Coast, the whole system of insuring coastal property is beginning to break down," says The Times' Jarvis, and Bloomberg's Flavelle warns, "Demand and financing could collapse before the sea consumes a single house."
Both stories point out the long-term record of rising sea levels, and the likelihood of a faster rise in coming decades. But in the near term, geology is as big a factor as climate change: In Tidewater Virginia, the focus of the Times report, land subsidence is responsible for much of the increased incidence of nuisance flooding, while in the Miami shoreline, as Bloomberg noted, porous limestone allows salty water to ooze up from the ground at high tide.
But the big question is how markets, the public, and the government will respond as periodic flooding becomes worse and more frequent. The National Flood Insurance Program (NFIP), the country's current safety line for homeowners, is up for re-authorization this fall — and in its current form, the program is a shaky standby, according to a recent report from the American Academy of Actuaries. Bloomberg BNA has a report (see: "Government Faces ‘Enormous’ Debt if Flood Program Isn’t Changed: Actuaries," by Brandon Ross). “Increased flooding due to higher sea levels can only increase the amount of loss from storms absent expensive investment in coastal defenses,” the Academy report says. “In the face of rising sea levels and increased losses, it will be impossible to maintain current premiums, coverage, and eligibility without severe limits on building, strong mitigation requirements, or exposure to enormous program losses and additional U.S. debt.”
STATE BY STATE
Minnesota: Builders are beefing about the cost of regulations and codes, reported The Twin Cities Pioneer Press (see: "Why do Twin Cities homes cost so much? We went to find out," by Bob Shaw and Tad Vezner. In a long analysis based on dozens of interviews, the paper zoomed in on several cost factors that affect the Twin Cities market, including building codes, zoning restrictions, high lot prices, and city-imposed fees. "The variety of factors affecting Minnesota’s housing prices are the responsibility of a labyrinth of entities," the paper reported.
Texas: A shortage of workers is holding back home construction in the Dallas market, reported The Dallas Morning News (see: "Labor shortages are hammering Dallas housing with higher prices, longer build times," by Steve Brown. From the report: "'Dallas is undersupplied by 10,000 to 20,000 construction workers,' Scott Davis, with housing analyst Meyers Research, told a meeting of local builders. 'We should have about 99,000 people employed in the building industry.' Instead, it's close to 80,000 construction sector workers in North Texas, Davis estimates... Wages for construction workers are soaring with the shortages."
Illinois: Rooftop photovoltaic solar panels may pose risks to firefighters, said fire department officials in Effingham, Illinois, according to a report in the Effingham Daily News (see: "Fire chief proposes new safety measures for solar panels," by Dawn Schabbing). Proposed new safety measures for the town "would require property owners who want solar panels installed to obtain a permit from the city electrical inspector," the paper reported. "Schematics of the project would also be required, and the project would also have to be wired so it has a separate shut off to the panels for safety."
California: "The state has revoked the license of the contractor that built the balcony in Berkeley that collapsed in 2015, killing six college students, essentially putting the company out of business for at least five years," reported The San Francisco Chronicle (see: "State license revoked for contractor in Berkeley balcony collapse," by Kevin Fagan).
Florida: "Thousands of homes have been evacuated as firefighters continue to battle 91 wildfires across Florida, the state's forest service said. Since Thursday, more than 25,000 acres have burned in the state, Florida Forest Service spokesman Joe Zwierzchowski told CNN on Friday" (see: "91 wildfires burn across Florida; thousands evacuated," by Nicole Chavez and Matt Rehbein).