Tree Frog Forestry News

Lumber Sits Near Its Lows – A Case For WOOD

By Andrew Hecht
Seeking Alpha
January 9, 2019
Category: Business & Politics
Region: United States

Andrew Hecht

The lumber futures market is highly illiquid. I would never recommend any long or short positions as the volume and open interest do not support a narrow bid-offer spread and the ability to move into and out of risk positions. While I have been trading commodities and futures since the early 1980s, I have never bought or sold one contract of lumber. However, I watch the price action in the lumber futures market like a hawk. Lumber is a benchmark, and the price trend of wood can be as significant as the paths of crude oil or copper when it comes to understanding and monitoring the health and well-being of the global economy. Lumber is a critical ingredient in construction and infrastructure building. The price of wood reflects the demand for new home construction in the United States.

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