Lumber prices could be set for a fall

<p>After being a leading commodity in 2012, lumber could be set for a price fall in 2013.</p>

Next year could see a marked fall in lumber futures, it has been warned.

Forest Economic Advisors LLC has suggested prices might tumble by as much as 25 per cent in 2013 following on from a seven-year high, Bloomberg reports.

The prediction comes as it is expected that output in Canada, the world's biggest exporter of the material, continues to increase.

Paul Jannke, a principal at the consultancy company – which is based in Westford, Massachusetts – explained that after leading the commodity market in 2012, the price of lumber could reach $300 (£185) per 1,000 board feet in the next 12 months. 

Mr Jannke claimed the peak for the commodity is in sight, with the initial spike to be followed by a ramping up of production.

"If the mills increase shifts from a 40-hour week to a 50-hour week, that's a big jump and everybody is ratcheting up their work weeks," he added. 

Find the latest CFD strategies for the commodities market at City Index.

Build your confidence risk free
Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.