Lumber futures swing 10% in wild session as speculative frenzy ends

A customer wearing a protective mask loads lumber onto a cart at a Home Depot store in Pleasanton, California, on Monday, Feb. 22, 2021. David Paul Morris | Bloomberg | Getty Images

By / Thomas Franck

Lumber futures gyrated in wild trading on Wednesday as traders struggled to determine if a recent pullback in wood prices had removed enough froth from the market.

Lumber futures for July delivery at first fell 5% to $1,201 per thousand board feet Wednesday morning, only to turn positive and rally 5% by the afternoon. Prices hit what’s known as limit down, and then limit up, the maximum percentage changes allowed by the Chicago Mercantile Exchange, where the futures trade.

Prices have fallen every day since lumber hit a record of $1,711 per thousand board feet on May 10. Despite the swoon, the price of lumber is still up about 37% in 2021.