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Rising lumber costs due to Canadian lumber tariffs are encouraging builders to consider alternatives to wood frame construction, like insulated concrete blocks (ICBs). In November 2017, the Trump administration implemented tariffs on Canadian softwood lumber averaging 20.83 percent. Since then, framing lumber cost has escalated to a record average high in June 2018 of $565. This is a thirty percent increase over the average composite price in 2017.
Consequently, according to Robert Dietz, chief economist for the National Association of Home Builders (NAHB), the tariff will increase the expense of a typical newly-built wood framed home by about $9000. Light wood frame construction has been widespread in the United States (U.S.) for over 100 years.
However, with the skyrocketing price of wood, new home builders and contractors should consider an alternative solution to wood framing materials, like Bautex insulating concrete blocks.
What is the Canadian softwood lumber Tariff?
The Canadian lumber tariff is a tax on lumber coming into the United States from Canada. In the U.S., tariffs are typically paid through a customs broker or agent when the product enters the U.S. The goal of the lumber tariff is to increase the price of Canadian lumber, thereby making presumably less expensive U.S. lumber more desirable.
How do the lumber tariffs impact contractors and builders?
Contractors in the U.S. are dependent on lumber imports for wood construction. In fact, 30 percent of the lumber consumed last year in the U.S., came from imported lumber. Of the imports, more than 95 percent came from Canada. In Texas, about 40 percent of all the framing lumber used comes from Canada.
The Impact of Lumber Spikes on Quotes and Bids
Contractors and builders often source the land and quote a price to a customer based on current expectations for the cost of materials. Because lumber is the largest component of a new wood frame home, estimating accurate lumber costs is essential to a contractor’s bottom line. Unfortunately, when the price for lumber spikes, as they have done recently, the builder can lose their profits. To recoup those losses, the builder may raise the prices on the next customer.
Bautex Wall System Offers a Solution to Lumber Tariffs
Contractors, builders, and architects can avoid the rising costs of lumber by selecting an alternative to wood framed walls, like the innovative Bautex Wall System. The Bautex Wall System is an insulated concrete block that saves building costs and time. Bautex Wall System also has significant benefits over wood frame construction.
Lumber prices in the U.S. are on the rise. The increase in lumber prices is forcing builders to increase their prices for new construction. Perhaps it's time for builders and architects to cut their dependency on wood construction and consider ICBs like the Bautex Wall System. Bautex ICBs are more energy efficient and fire, wind, and moisture resistant than buildings constructed with wood. For a solution to record high lumber costs due to lumber tariffs, builders should consider the Bautex Wall System.