The Fort #123: Stinson Dean - 'Lumber Industry 101'
On this episode, Stinson Dean (www.Twitter.com/LumberTrading), the Founder of Deacon Lumber, joins Chris to provide a deep dive into the Lumber industry. Stinson explains his role as a Lumber trader, why most homes in the US are built from Canadian Lumber, the tariff issues between the US and Canada, the Lumber supply chain, and why we are seeing the highest prices ever recorded. Enjoy!
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(02:40) - Stinson’s Journey Into Lumber and What He’s Doing Today
(08:18) - Why are futures under-utilized?
(11:44) - How many people are doing what you do in lumber?
(12:39) - Why do a lot of people not participate in lumber as opposed to other commodities?
(14:43) - Are there government subsidies for lumber?
(16:48) - What’s the shelf life of lumber?
The Business Model for Lumber
(18:11) - Who are you buying from and where are you storing it?
(22:34) - Where does your business fit in the supply chain?
(23:49) - How does the full supply chain work starting with the tree?
(34:14) - How long does it take a tree to grow to a point where it can become lumber?
(34:54) - Why are lumber prices skyrocketing right now?
(40:50) - Is there still COVID caution in the market?
(45:21) - Opportunities in an Inefficient Market
(46:15) - Who’s making all the money in a market with historically high prices?
(49:05) - Blue Stain Lumber
(52:33) - Have the tariffs that are in place been the reason for Canadian sawmills buying mills in the US?
(54:53) - Why does Lumber grow better in Canada? Are fires more likely in the US?
(57:49) - How do most of these forest fires start?
(59:32) - Why aren’t mills adding capacity?
(1:00:27) - Is there an opportunity for VC to step in and make a giant change in the industry?
(1:02:35) - Are you betting lumber prices will go higher or lower?
Types of Lumber & Pricing
(1:04:38) - What are the main types of lumber being used?
(1:06:42) - The quality of Lumber Being Used in Custom Homes vs. Production Homes
(1:09:44) - The Price of Multi-Family Lumber vs. Single-Family
(1:12:04) - What % of a typical home is comprised of lumber in single vs. multi-family?
(1:14:28) - What are some tips for a regional/small home builder to better hedge this risk?
(1:19:55) - What’s the current time frame for locking in prices right now?
(1:20:30) - How are smaller builders purchasing their lumber?
(1:22:19) - Is there any interesting technology being created within the industry?
(1:25:50) - What is the biggest risk right now in lumber?
(1:27:38) - How is money made or lost in this industry? What are general risks in your part of the industry?
(1:36:32) - Do you have a childhood experience that shaped who you are today?
(1:40:00) - What’s the best advice you’ve ever been given?
(1:40:27) - What’s your favorite book?
King of Capital by David Carey
(1:42:55) - How can people reach you?
The FORT with Chris Powers is produced by Straight Up Podcasts