US Starts Surge 5.2%; Tight SPF Supply Expected Q3/Q4

Impact on Your Procurement Strategy

The US construction engine is running hot right now, creating intense immediate demand for framing materials. US Housing Starts jumped 5.2% month-over-month in July to a seasonally adjusted annual rate (SAAR) of 1,428,000. Crucially, Single-Family Starts also increased 2.8% to a rate of 939,000. Furthermore, completions were up 6.0%, meaning builders are actively moving existing pipelines, driving high demand for SPF, SYP, and Hem-Fir to finish these projects. This high activity level translates directly into immediate pressure on pricing and lead times for Q3 deliveries, especially for commodity items like 2x4 and 2x6 dimension lumber.

This immediate US demand surge is colliding with robust domestic construction activity in Canada, a primary source for US SPF. Investment in Canadian residential building construction expanded 3.1% in June, driven by strong gains in the multi-unit segment (4.2% increase). This strength, particularly in key production regions like Quebec and British Columbia, means Canadian mills are prioritizing local demand. Buyers should anticipate potential supply friction and extended lead times out of Western Canada and the US Northeast (which relies heavily on Eastern Canadian SPF), as availability for export tightens due to this domestic pull.

While current demand indicators are very strong, buyers must keep an eye on the leading edge. US Building Permits, the forward-looking indicator, fell 2.8% overall in July. Though single-family permits remained stable (up 0.5%), the overall decline suggests a potential moderation in demand growth heading into 2026. Supporting the overall market health, US mortgage delinquencies fell slightly to 3.93% in Q2, indicating underlying stability in consumer finance and minimizing the risk of a sharp housing market correction.

Given the conflicting signals—strong immediate demand/tight supply versus softening future permits—the procurement strategy is clear: Buy for the short term, but maintain lean inventory for the long term. Focus on securing the material needed to fulfill current contracts through Q3 and potentially early Q4, recognizing that supply windows may be tight due to high US demand and strong Canadian domestic pull. Avoid speculative buying that extends deep into Q1 2026, as the lagging permit data suggests demand may ease and pricing pressure could dissipate by year-end. This is a time for precision inventory management, prioritizing delivery assurance over future price gambles.

Key Takeaways

• Prioritize securing Q3 framing lumber (SPF/SYP) now. US Starts are up 5.2%, signaling immediate demand will rapidly consume available mill inventory.

• Expect extended lead times on Canadian SPF. Strong Canadian residential investment (up 3.1%) will divert material domestically, tightening US import availability.

• Maintain lean inventory beyond Q4. The 2.8% drop in total US permits signals potential demand moderation entering 2026; avoid expensive speculative stockpiling.

• Monitor regional supply closely. High multi-unit construction in Quebec/BC will limit SPF exports from those key regions.

Market Outlook

Pricing Trend: UP Confidence Level: MEDIUM Recommended Action: Secure Q3 framing lumber inventory immediately. High US Starts (up 5.2%) combined with robust Canadian domestic demand (Residential up 3.1%) will tighten SPF availability and push prices. Focus on locking in delivery windows for the next 45 days.

How LumberFlow Helps

The current market volatility driven by high demand requires fast action. Use LumberFlow’s multi-supplier RFQ system to rapidly source quotes and compare lead times across multiple regional suppliers before availability tightens further. Our quote comparison dashboard ensures you evaluate the best combination of price and delivery schedule, mitigating supply risk.

Ready to stay ahead of market trends? Book a consultation with our team to see how LumberFlow's procurement platform transforms dimensional lumber buying.