Ross Ridout
Ross Ridout, president and general counsel of Ridout Lumber Cos. of Searcy, had some insights into the pandemic-linked phenomenon of soaring lumber prices Arkansas Business reported on last week, a spike so high that some homebuilders are delaying projects.
“It’s been a weird year,” Ridout said, “because everyone, basically, in the lumber business started to shut down as the pandemic hit, and then demand actually increased, which no one saw that coming.”
That led to “a fairly significant supply shortage, which we’ve been able to work our way through without being out of a lot of things, but it has put some strain on folks,” he said.
“One of the weirdest things was that our walk-in business went up quite a bit, which is the last thing you would think would happen in a pandemic.”
People stuck at home began launching home improvement projects and that led to a widespread shortage of treated lumber, Ridout said, “because everyone was building a deck or a fence during that time.”
Ridout attributed increased sales not just to furloughed workers fixing up their living quarters but to higher housing starts, “so everyone’s busy anyway.” He estimated that lumber yards on average had seen “at least a 20% bump in sales just because of the commodity pricing, which is a lot, of course.”
Ridout Lumber has 12 locations in Arkansas and one in Joplin, Missouri, and the vast majority of its business is with builders, Ridout said, “so we’re sympathetic with those folks, because they’ve really absorbed the brunt of this.”
Ridout figures that lumber prices will come down in the fourth quarter, as they usually do. But demand remains high and supply is limited. “The question is how much will it correct? The futures markets have been erratic, to say the least.”
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