After wild up-and-down price surges due to the pandemic, Devin Stockfish, president and CEO of lumber giant Weyerhaeuser (WY) - Get Weyerhaeuser Company Report predicted that lumber will continue to moderate. He also told Jim Cramer on a recent episode of "Mad Money" that the housing boom is likely to continue for years.
The growth in the housing market has helped push Weyerhaeuser’s shares upward by more than 30% over the past year.
At the onset of the pandemic, lumber prices plunged. A year later, prices were at record highs as the Delta variant ran head-on into strong housing and a strong repair and remodel cycle. Going forward, Stockfish says he expects lumber prices will continue to moderate back to more normal levels.
Stockfish said the boom in housing is likely to continue for years to come. He said the U.S. has been building fewer homes than it needs for decades, which has led to significant pent-up demand. Add to that favorable demographics with millions of millennials looking to buy their first homes and that means growth Stockfish predicts will be around for a long time.
The company plants 140 to 150 million seedlings a year in its harvested sites, equivalent to almost four trees a second, according to the company website. Weyerhaeuser meets more than 70% of its energy needs in its manufacturing facilities from renewable biomass by using what would be wood waste from sustainably managed forests and mill residuals to create its own energy.
In January 1900, Frederick Weyerhaeuser and 15 partners undertook the largest private land transaction in American history to that time, when they purchased 900,000 acres of Washington state timberland from the Northern Pacific Railway.