The Federal Reserve G.17 Industrial Production report indicates that U.S. sawmill production decreased in the first quarter, marking the second consecutive quarter of a decrease in output.
After experiencing an increase in the post-pandemic period, sawmill output has remained essentially stagnant since 2023.
In the fourth quarter of 2025, the utilization rate for sawmills and wood preservation industries was 71.2%. However, it increased to 71.8% on a four-quarter moving average.
The sawmill utilization rate, which is a quarterly publication of the Census Bureau that measures the actual production in relation to the prospective full production, increased in 2025 as the capacity of sawmills decreases.
Compared to the fourth quarter, sawmill production decreased by 0.4% in the first quarter of 2026, but it remained 1.7% higher than it was a year ago, as indicated by a four-quarter moving average.
The full production capacity of U.S. sawmills, which is an estimate of the quantity that could have been produced if they were operating at full capacity, decreased by 6.0% from the previous year.
The first quarter saw a modest increase in lumber prices.
Prices of softwood lumber increased by 6.1% during the quarter, but they were down by 3.8% from the previous year.
Hardwood lumber prices surged by 1.0% in the first quarter, continuing to rise.
This quarter marked the ninth consecutive quarter of price increases in hardwood lumber.
There was a continued decline in employment in the sawmill and wood preservation industries, with approximately 82,800 workers employed during the first quarter.
This event represented the twelveth consecutive quarterly decline, which resulted in the lowest employment level since 2010.
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