By: Brad Kahn
FSC commonly receives questions about price premiums for FSC-certified products. While FSC-certified landowners have earned any premium they might receive, the reality in the market is much more complicated.
FSC products compete with other certified and uncertified products in the market, and are influenced by broader trends, just as any other product is.
A recent article in Forest2Market highlighted the steep price for lumber this summer, for example, as stronger-than-expected housing starts and remodels, plus speculation, drove prices to new highs. A separate article noted that future prices for lumber tripled from their low in April 2020, and double the typical price in recent years.
To understand how the current dynamics shape prices for FSC construction materials, we talked with Terry Campbell, Director of Business Development at Sustainable Northwest Wood, an FSC Certificate Holder and Member in FSC’s Economic Chamber. “It’s important to break down pricing product by product,” Campbell noted. While some engineered wood products – especially LVLs – can be difficult to source as FSC in the Pacific Northwest, other products such as dimensional lumber, plywood, timbers, cladding and interior finishes are regularly available. With so much interest in cross-laminated timber (CLT) and mass timber, it is important to note that many of the major manufacturers are FSC certified. While not all of their CLT is FSC certified, the following companies can deliver FSC-certified CLT if it is requested by customers: D.R. Johnson, Katerra, Kalesnikoff, Nordic Structures, SmartLam North America, Structurlam Products, and StructureCraft.
Relationships with suppliers can matter as much as economic forces. Some companies “artificially push prices up,” for FSC products, applying a standard premium percentage whenever FSC is requested. By contrast, others set prices based on current market conditions, with premiums ranging from 0% or even lower prices for FSC, up to premiums as high as 20% or more. As competition increases in a region, premiums typically go down, so regions with more FSC suppliers tend to see more competitive pricing.
Sustainable Northwest Wood exclusively offers locally sourced materials from well-managed forests and ecosystem restoration projects. “We have won jobs where the client did not ask for FSC, but we still quoted it and made the sale,” Campbell stated.
Ironically, because Sustainable Northwest Wood stocks significant quantities of FSC lumber, enough to entirely frame several houses at a time, it can be insulated from short-term swings in pricing. “We peg pricing off the last time we bought a truckload,” Campbell noted. In any case, it is best to begin conversations with suppliers early in the design phase of a project to identify what is available at competitive pricing.
So, what is the premium for FSC? Inevitably, the answer is “it depends.” But like any other purchase, it pays to do research ahead of time, get to know suppliers and choose a partner you feel you can rely on.
To help in sourcing construction materials suppliers in the United States, Canada, and Mexico, the FSC Supplier search at buildwithfsc.com is an invaluable resource.
Brad Kahn is communications director of the Forest Stewardship Council U.S.