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Leading Economic Indicators that Affect Stumpage Prices

Several leading economic indicators that affect the value of lumber and consequently stumpage values of hardwood timber.  Housing starts have fluctuated a little over the last few months, but the general trend line is positive.  The Consumer Confidence Index is showing a steady (and substantial) increase since last September, and the Unemployment Rate is also steadily declining.  As people begin to feel more confident about the economy, as unemployment decreases, and (most likely as a response to these things) people start buying/building houses, the need for hardwood lumber – which goes into flooring, cabinetry, trim and furnishings – increases.  These factors should provide for increasingly solid markets for hardwood timber moving forward.

Housing Starts

Housing Starts US 2 16 2 17 1200x557
Housing starts have fluctuated a little over the last few months, but the general trend line is positive.

Consumer Confidence Index

Consumer Confidenceindex CCI 2 12 217
The Consumer Confidence Index is showing a steady (and substantial) increase since last September

Unemployment Rate

US Unemployment Rate3 12 3 17
The Unemployment Rate is also steadily declining. As people begin to feel more confident about the economy, as unemployment decreases, and (most likely as a response to these things) people start buying/building houses, the need for hardwood lumber – which goes into flooring, cabinetry, trim and furnishings – increases.