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According to the Commerce Department data, housing starts increased 11.8% to a seasonally adjusted annual rate of 1.679 million units last month, the highest rate since March. So, the demand for lumber is expected to increase amid a surge in homebuilding. However, a bad wildfire season in the U.S. Pacific Northwest and British Columbia, and Western Canadian flooding, continues to impact lumber supply. So, lumber prices could continue their ascent. According to Richard Fung, a custom home builder with Forever Homes, “Lumber prices are expected to rise in the next year, and if this fluctuation of high prices continues, the price will have tripled by 2025.”
Therefore, we think it could be wise to scoop up the shares of fundamentally sound lumber-related stocks Weyerhaeuser Company (NYSE:WY), UFP Industries, Inc. (UFPI), and Boise Cascade Company (BCC). They are well-positioned to take advantage of the rising lumber prices.
