Lumber prices soar after hurricanes hit
October 4, 2005
Local contracting businesses will have to pay more money for lumber and other building materials from vendors due to hurricanes Katrina and Rita.
“The price of lumber is a commodity when you have a catastrophic event such as this,” said Randy Hawkins, general manager of Stock Lumber Company, 1926 Sycamore Road.
Hawkins said businesses such as his will have to pay more for building materials than a month ago because of operation costs.
According to Hawkins, the price of lumber from vendors has appreciated 5 percent and plywood by 50 percent in five weeks.
“A month from now we will see prices come back to normal,” Hawkins said.
According to Hawkins’ experiences, emotions have been “fueling” rising building supply prices.
“It’s all a temporary thing and very emotion-led,” Hawkins said.
Even though Stock Lumber Company did not have to postpone any projects, it still faces a threat because of rising fuel costs.
“We are more concerned with fuel aspects than the price of our products,” Hawkins said.
Karen Jerde, president and co-owner of SWI Construction Inc., 1521 Pickwick Lane, said overall, the hurricane disasters have not affected business so far.
“We will have to see how it works out for all of us,” Jerde said. “We might get some new contracts in the hurricane areas if we decide to move business to the South,” Jerde said.
While vendor prices have gone up consumer prices have not changed as much.
Derek Rexroth, store manager of Lowe’s Home Improvement Warehouse Store, 2050 Sycamore Road, said consumer prices could not drastically fluctuate because of how the prices are structured around government laws.
“The government doesn’t allow us to price gouge the customers,” Rexroth said. “It is effective because prices have been about the same price,” Rexroth said.
At Lowe’s, a piece of plywood can be purchased from $9.98 to $23.49 depending on thickness, and a two-by-four for $2.15 – the same prices before either hurricane disaster.
The store does not have a shortage in any building materials; however, Rexroth said it has been more difficult to get vendors to supply some materials.
Meanwhile, Federal Emergency Management Agency has been contacting local companies, including the Stock Lumber Company, asking if it would be willing to send any supplies to the hurricane areas.
Hawkins said his company declined the offer, but the government understood the position as a business.
“We decided to keep our products in DeKalb so our business would have little disturbances,” Hawkins said.
Lowe’s partnered up with the Red Cross to raise money for Hurricane Katrina victims, raising a combined $5 million at all Lowe’s stores across America.
Products, such as saws and generators, were also provided from Lowe’s for the cleanup of Hurricane Katrina and an employee relief fund was set up for Lowe’s employees in Louisiana and Texas.
According to the U.S. Department of Homeland Security, 637,000 households have received $1.5 billion in disaster assistance so far and about 54,800 housing damage inspections were completed.