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Home » Wallboard prices rise, but probably not for long

Wallboard prices rise, but probably not for long

GypsumÂ’s price is known for fluctuating, say unfazed building-product experts

February 26, 1997
Megan Cooley

Dont like the weather in Eastern Washington? Wait five minutes.


Dont like the price of gypsum wallboard? The same advice might apply.


The price of that material, which is used to build walls and ceilings in residential and commercial buildings, often fluctuates by 10 percent to 20 percent, say some representatives of the building-products industry here. They blame the price swings on seasonal changes in demand, the shrinking number of gypsum wallboard manufacturers, and shipping costs associated with the location of natural gypsum sources.


Its like going to the gas station, says John Fehlig, commercial sales supervisor at the Home Depot Inc. store in North Spokane. You never know where the price is going to be.


Gypsum wallboard, also referred to as drywall, plasterboard, or by one well-known trade name, Sheetrock, is made mostly of gypsum, a chalky material found in sedimentary rocks. That material is compacted, then covered with heavy paper to create wallboard, which is sold in a standard size of half-inch, 4-by-8-foot sheets.


Currently, a sheet of that size costs about $3.85 at building-materials retail stores here, but as recently as seven months ago, the price was as low as $3.10 a sheet, Fehlig says. In March, the price was $3.70. In early April, it was $3.88, then dipped to $3.65 by the end of the month, he says.


Demand for gypsum wallboard, and often its price, goes up in the fall and winter, Fehlig says, when homeowners and contractors turn their attention to indoor projects.


Consistently, Sheetrock prices go up in the fall, he says. Once it gets competitive, though, and theres a price war (among retail stores and suppliers), the prices start going down.


The North Spokane Home Depot store sells an average of about 2,500 gypsum wallboard sheets a week, and 200 to 300 sheets of the product are used in the construction of a typical new house, Fehlig says.


He compares the fluctuating price of gypsum wallboard to another notoriously volatile productlumber.


Lumber goes up and down, and drywall goes up and down, he says, but other than that, everything else is pretty stable.


Reid Ziegler, who together with family members owns Spokane-based Ziegler Lumber Co., which operates Ziggys Building Materials stores, says that unlike lumber, gypsum wallboard doesnt have a national reporting group that calculates where drywalls true supply-and-demand price point is.


Its a game thats always in flux, he says. Getting a good price on gypsum wallboard is relationship driven. Its who you know.


Ziegler says retailers must act fast to negotiate the best possible price when a manufacturer ramps up production.


The big players in the industry get together and announce a price increase, he explains. Then, the scrambles on to negotiate the best deal before it goes up again.


The number of gypsum-wallboard manufacturers is shrinking, Ziegler says. Big companies such as British Petroleum PLC, USG Corp., and Pacific Coast Building Products Inc. have bought smaller manufacturers, such as Seattle-based James Hardy Gypsum, during the last decade, he says.


These companies control the supply of Sheetrock better than when more companies manufactured it, Ziegler says.


Because gypsum wallboard is a heavy product, weighing about 56 pounds for a standard-size sheet, shipping costs also play a role in the price an end user pays, Ziegler says.


Gary Anderson, general manager of the Spokane office of Yakima-based SECO Construction Equipment Inc., says that gypsum, the raw material, can be found in many parts of the U.S. and the world.


When large quantities of gypsum are found, manufacturers swarm to that area and increase production, he says. That also can influence prices, Anderson says.


If they hit a hot spot, thats where they start digging and send the work there, decreasing the price of gypsum wallboard in that area, but increasing it elsewhere because of shipping costs, he says.


Some of the largest gypsum sources are in Montana and Wyoming, Ziegler says.


He adds, though, that if theres a surplus of gypsum wallboard in the market, manufacturers sometimes will absorb shipping costs to keep their plants running.


Its the nature of knowing the business and who needs an outlet for supply, he says. Those things change constantly.

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