One little-discussed trend affecting our economy: Wood prices are up 67 percent over the past year, adding thousands of dollars to the cost of each new house. Meritage Homes Corp. CEO Steven Hilton said recently that higher lumber prices have this year added about $3,000 on average to the cost of each house it builds.
The historic run-up in lumber prices is attributable to a trade dispute with Canada, wildfires and limited rail capacity. This comes as U.S. home builders are already struggling to meet demand amid shortages in buildable lots and labor.
But it's good news for timber companies. Shares of CatchMark Timber Trust, Rayonier and PotlachDeltic have each risen more than 11 percent over the past year. Shares of Weyerhaeuser, the largest private owner of timberland in North America, closed on Tuesday at the highest price in its 118-year history.
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