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Lumber prices soften as housing starts slow

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Saturday, July 01, 2006

The number of new housing starts in Oregon and the United States grew by 13.6% and 4.1%, respectively, during 2005, the fifth consecutive year of growth for both areas. However, with many economists expecting the real estate boom to subside, the number of starts fell 8.2% in Oregon and 0.6% nationwide in the first four months of 2006 versus the same period in 2005. Likewise, after a banner 2005, western softwood lumber output has dropped 5.6% for the first four months of 2006. With production slackening, Random Lengths’ framing lumber composite price has still declined — by nearly a third from its peak in August 2004 — though it has not reached the lows seen from 2001 to 2003.

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