Some supplies in high demand due to coronavirus pandemic
The economic disruption of COVID-19 has only become more apparent for contractors, builders and suppliers in Western New York this summer.
With many building projects and contracting jobs poised to ramp up to full speed after phased reopening, increased prices and demand for treated lumber has caused new concerns.
“I think we are off a little bit on construction but I do see it picking up,” Lakewood Building Inspector Jeff Swanson said at a board meeting this week. “Everything I am hearing, building supplies are getting tougher and tougher to get, especially pressure-treated wood and stuff like that. I’ve been hearing that cost is up on construction materials by at least 30%. If that will slow things down again, who knows?”
With municipalities being forced to shut down building permits during the pandemic, there has been a rush for many projects to get started as restrictions have eased.
That disruption of normal business has not only rippled through the plans of contractors, but has also caused changes in supply chains for building materials.
The current market for treated lumber, a staple in almost all construction, is now vastly different.
“(Prices) are over double what they were probably 10 weeks ago. That is generally for lumber and pressure-treated lumber,” said Bill Briggs, president of Chautauqua Brick. “That, coupled with the fact of non-availability, the supply chain has been disrupted because of the COVID virus. The mills, a lot of them shut down for a while in the spring and shut down in anticipation of there not being any demand this year. Consequently, they got behind the eight-ball. They didn’t keep producing and all of a sudden states, like New York for instance, said that building supply stores were an essential business and had to remain open and should remain open. They have never looked back and we’ve never caught up in the supply chain.”
During normal times, mills are able to follow seasonal changes in demand and adjust accordingly. The twin-pronged problems with both staffing and demand that have been caused by COVID-19 are unprecedented.
“I’ve been around the business for 40 some years, I’ve never seen it like this where you order something and they tell you what the price is going to be when they ship it. Price time of shipment,” Briggs said. “It is a struggle. It is a struggle for the contractors, the homeowners, and for us too because it looks like we’re gouging and we really aren’t. We’re really making less margin on the product than we were before and are trying to keep people supplied. The contractors, of course, sign a contact to build a house for X number of dollars, now all of a sudden it is 50% higher, 100% higher. What are they going to do? We’re fighting it day in and day out. I never know what I’m going to get each week until it shows up.”
Depending on the type of lumber needed, the impact of COVID-19 can be slightly different.
For Colecraft Commercial Furnishing, which specializes in custom furniture solutions, pricing changes on hardwood have been less drastic than for treated construction lumber.
“We do not buy treated lumber but have heard that treated lumber is getting difficult to buy because of the process used to make it and the areas of the country that are doing the treating,” President and CEO Dave Messinger said. “In general, lead times today are less predictable than during normal times. Reduced production capacity of some commodities has also resulted in upward price pressure. Because of the current situation, we’re budgeting for a 5% raw materials increase over the next several months. Most all of the materials that we use in our furniture are part of this upward movement.”
Messinger added that softwood lumber, which is used for crating and skidding finished goods in shipment, has increased between 5-10%.
For other local businesses, the treated lumber increases have not been a direct cause for concern. However construction projects often come together using a wide range of different contractors, suppliers and workmen. A ripple in one area of the industry is likely to spread out and affect others.
“We’re not contractors, we are a design-and-sell type firm. We don’t see any rough building materials like that,” said Andy Proctor, owner of Jamestown Kitchen and Bath. “Our supply chains thus far have been fine. Lead times have gone out a little bit for us to get materials in. From what I understand lumber, building materials in general are crazy. Prices going through the roof and you can’t even get your hands on a lot of it.”
Even operating in a different area of the business, Proctor has noticed the strain placed on contractors and suppliers.
“I think maybe the biggest problem we have right now is how busy all the contractors are,” Proctor said. “If customers are coming in our store, to get a contractor to their house it could be four to six months because everybody is so busy. I am a little concerned because I had a sales rep in yesterday–the next thing is going to be the cabinet companies are going to have a hard time getting their hands on lumber and the wood that it takes to build the cabinets. We haven’t seen it or heard it officially yet, but I am concerned.”
The ripple of the shutdown is likely to continue into the future, potentially hitting other building materials.
“Just recently now roofing has become a problem,” Briggs said. “Shingles have been a problem. They are eight to ten weeks out lead time. That is just one example. It affects everybody differently but rest assured, everybody is being affected by it.”
Briggs said he believed that lumber supply and demand might stabilize somewhat by the middle of September, but that deadline may have to be pushed back.
“Now the information I’m getting from the mills and so forth is that they look for it carry on to the first of the year. As far as the high pricing and availability of material,” Briggs said.