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Timberland stumpage prices have lagged despite higher lumber costs
The article points to persistent timber supply exceeding harvest, keeping market leverage with buyers even as demand drivers like housing shortages and inflation failed to lift prices.
Timberland has long been marketed as a long-term asset for patient investors, with the case built on sustained demand for forest products, steadily rising land values, and the biological growth of timber. However, LandThink argues that the expected price compounding stalled after the 2008 recession and has not meaningfully recovered, with many pine product stumpage prices today below levels seen 20 years ago.
LandThink says that while recent headlines have featured several factors that could support stronger timber markets, including a national housing shortage, record lumber prices, tariffs on Canadian imports, and inflation, stumpage prices have not followed. In Alabama, a forester and land broker attributes the mismatch to structural conditions that continue to suppress prices.
A core explanation, according to LandThink, is that timber supply exceeds current consumption, with an imbalance that has built over decades. The outlet cites US Forest Service forest inventory data showing that in Alabama, annual timber growth has exceeded harvest removals for at least the past two decades, leaving standing timber inventory at record levels and shifting leverage toward buyers.
LandThink also links the accumulation to policy and practice changes, saying that Conservation Reserve Program incentives encouraged conversion of marginal farmland and pasture into planted pine, expanding the supply base. It adds that modern forestry practices have increased growing efficiency on those acres, further reinforcing the supply surplus even as new sawmill capacity has been added.