The United States is preparing to ramp up duties on more than $3 billion worth of Canadian lumber, more than doubling the current rate (14.5%) on all softwood crossing the border to 34.5%. That is according to a special memo shared by the Department of Commerce, which, if added to 25% tariffs on Canadian imports (yet to be formally imposed by Donald Trump), will see taxes on Canadian Douglas Fir spike at 60%!
“The Department of Commerce determined that softwood lumber from Canada was being dumped into the United States at preliminary margin rates ranging from 9.48% to 34.61%,” according to its Preliminary Results of Softwood Lumber from Canada Antidumping Duty Administrative Review. “These preliminary margin rates are, on average, larger than the final antidumping margin rates determined in the previous administrative review.”
Over the weekend, David Eby, British Columbia’s Premier, said the duties are “unjustified,” adding that they will “drive up housing costs for Americans who voted for a president promising to lower costs.” Taking the matter up with Mark Carney, Canada’s new Prime Minister, Eby wants to see a “Team Canada approach to protecting timber jobs, like with the automotive and steel industry jobs in Ontario and Quebec.”
The new duties come amid mounting pressures on Canadian producers, including higher input costs, wildfires, and a mountain pine beetle outbreak, which is impacting tens of millions of acres of forests in western Canada. In Quebec, Canada’s second-largest producing region, industry executives struggle to see past the pressures and a wall of U.S. trade barriers.
“At today’s prices, it’s an unequivocal dead end. A two-by-four piece will sell for about $3 today, but the same piece was selling for more than $10 in 2022, even though our production costs have risen.”
Frederic Verreault, vice president of corporate affairs at Les Chantiers de Chibougamau Ltee, a major Quebec wood processor selling roughly half of its products to the U.S who spoke to the Financial Post.
About 30% of all lumber consumed in the US is imported from overseas, with Canada accounting for more than 80% of these imports. Despite builders warning that tariffs could directly result in the cost of a single-family home rising by at least US $9,200, Wood Central understands that lumber is part of a narrow range of product groups that the Trump administration wants to bring back to the US and will, therefore, be subject to higher duties moving forward.
The problem is that despite granting the US Forest Service new powers to salvage timber from more than 112,000,000 acres of National Forests, it remains under-resourced and completely ill-equipped to deliver on Trump’s agenda to “free up” forests for domestic lumber production and reduce dependence on Canadian and European wood.
“Even with executive orders promoting federal timber harvesting, legal battles from environmental groups are likely to delay or block proposed logging operations,” according to a report produced by Global Wood Trends, revealing that three decades of under-investment and DOGE cuts means “the timber industry faces a severe workforce shortage, including a lack of loggers, truck drivers, road builders, and mill workers.”
- To read more about the on-again, off-again tariffs and their impact on the supply chain for forest products, click here to learn why US builders are now stockpiling lumber and substituting Canadian Douglas fir for American-grown Southern Yellow Pine.
