2024 Forest Products Outlook Summary

2023 was a challenging year for wood products markets. Rising interest rates hampered demand while capacity ramped up across the south. With U.S. interest rates appearing to have stabilized, has the U.S. avoided a recession or is the second shoe about to drop?

Paul Jannke, a forest industry expert with Forest Economic Advisors (FEA), recently presented his perspective on the region’s forest product markets and economic outlook. Read on for the key takeaways from this informational webinar.

Housing Market

High mortgage rates, supply chain constraints, and builder concentration are limiting stronger housing growth. Housing starts are projected to remain flat at around 1.4 million units in 2024 before increasing to 1.5 to 1.6 million in 2025. Single-family home construction is expected to rise due to demographic tailwinds and shift from multi-family builds.

Home Renovations

Renovation spending is forecast to remain above trend due to high interest rates discouraging people from moving, an aging housing stock, and increased working from home.

Industrial Lumber Demand

Strong outlook driven by reshoring manufacturing, shorter supply chains, low-cost production, and construction of new industrial facilities.

Lumber Prices

Lumber prices are expected to remain mostly flat in 2024 due to balanced supply/demand but are expected to rise modestly in 2025 as costs remain elevated.

Trade

Exports are flat with weak Chinese demand offsetting any growth. Imports from Europe remain strong despite the Russia/Ukraine war disruption.

Timber Supply

Declines in timber supply are projected in British Columbia, western United States and Eastern Canada due to pest infestations, fires, regulations and caribou protection policies. The southern United States is the only region with excess timber supply from capacity expansions.

To dive deeper into the above topics, review the 60-minute webinar recording along with the presenters’ PowerPoint slides, or read Jannke’s 2024 Forest Products Industry Outlook.

Watch the Webinar Recording

Read the 2024 Forest Products Industry Outlook Report