Yes, these companies and contractors have already spent a ton of extra money panic-buying lumber at a highly elevated price due to the shortage. Many of them probably didn't even have a choice but to buy in order for their building contracts to stay valid.
For most it's far more expensive to get bogged down in litigation than just buying the lumber at whatever the asking price is. So now they've got to cut corners or find another way to make money despite of their elevated holds of lumber.
The result may very well be deflation, as contractors are now forced to undercut each other to get new building contracts, as lumber production has been increased to meet the demand. That is if you can afford to wait.
Think of it like a traffic jam. The cars behind the lumber car won't be able to move before it can move, and then—due to market insecurities—the lumber car might not even be able to go full steam ahead. Because no lumber producer wants to producer more lumber than necessary, since that'll only lead to the price dropping unnecessarily. And so we're stuck in a situation where the line leap-frogs slowly forward until the guys in the front finally feel safe enough to push the pedal to the metal.
For most it's far more expensive to get bogged down in litigation than just buying the lumber at whatever the asking price is. So now they've got to cut corners or find another way to make money despite of their elevated holds of lumber.
The result may very well be deflation, as contractors are now forced to undercut each other to get new building contracts, as lumber production has been increased to meet the demand. That is if you can afford to wait.
Think of it like a traffic jam. The cars behind the lumber car won't be able to move before it can move, and then—due to market insecurities—the lumber car might not even be able to go full steam ahead. Because no lumber producer wants to producer more lumber than necessary, since that'll only lead to the price dropping unnecessarily. And so we're stuck in a situation where the line leap-frogs slowly forward until the guys in the front finally feel safe enough to push the pedal to the metal.