CALGARY -- The recent softening of record high prices for lumber could translate into relief for homebuyers and do-it-yourselfers while continuing to spur high profits for producing companies, analysts say.

A US$14 drop to US$941 per thousand board feet in the North American framing lumber composite price on Friday represents the first weekly decline noted by industry watcher Random Lengths since April 10, said RBC analyst Paul Quinn in a report.

In the same week last year, the price was just US$367.

"Buyers largely stepped to the sidelines as prices began to fall," Quinn said. "We would not be surprised to see continued declines in the coming weeks, but would note that the November lumber futures contract increased US$28 week-over-week to US$607 per thousand board feet."

Prices hit record levels this summer after many producers temporarily shut down due to the COVID-19 pandemic, reducing inventory levels as people working from home began renovation projects and the new home market proved surprisingly resilient.

Price-conscious buyers are now delaying projects to avoid high prices as the peak summer construction season draws to a close, said Kevin Mason, managing director of ERA Forest Products Research.

"Those prices are holding up at incredibly high levels still but you are starting to see a little more weakness starting to creep into the market and there is some downward pressure," he said.

"With these very high prices, you are seeing an impact on demand. So there are some projects that are getting postponed," he said, adding some multi-family developments could be looking at millions of dollars in additional costs from higher building product prices.

"You have a seasonal slowing in demand and the retail (renovation) demand is slowing as well.

However, he said the change in prices will simply drop lumber producers from "astonishingly profitable" to "remarkably profitable" levels, adding he expects robust financial results for the remainder of this year and likely through 2021.

Random Lengths reported that oriented strand board, a panel product commonly used to sheath new houses, was unchanged on the week at US$690 per thousand square feet, up from US$218 a year ago.

Homebuilders say forest product price increases this year have added as much as $10,000 to the cost of building a typical single-family house in Canada.

This report by The Canadian Press was first published Sept. 28, 2020.