American lumber buyers are purchasing locally, despite the higher costs, as they seek stability due to tariff uncertainties regarding Canadian imports.
Keta Kosman, publisher of Madison’s Lumber Reporter, states that lumber suppliers and customers have expressed “great frustration at the lack of clarity” regarding Canadian wood exports. Obtaining answers is challenging, and information changes daily. Instead, they are turning to American sawmills to ensure shipments, even with higher prices that could ultimately result in more expensive houses.
“With spring construction on the horizon, purchasers on both sides of the border lamented slim inventories and a tariff deadline,” Kosman tells BUILDER. “There was a persistent worry that overall supply won’t be enough to cover spring needs. Demand was further disrupted by frigid winter weather across much of eastern Canada and the northeastern United States.”
Canadian sawmills experienced a decline in inquiries from the U.S. as the early March deadline for tariffs from the Trump Administration approached. Alongside the looming tariffs, President Trump signed two executive orders concerning lumber production in the United States in early March.
- Government departments have until the end of the year to report their findings on whether imports of timber, lumber, and their derivative products pose a threat to national security. The order also requests recommendations for actions to mitigate these threats—including tariffs and export controls—and policy suggestions aimed at strengthening the U.S. timber and lumber supply chain.
- The second executive order mandates updates in the coming months regarding timber resources from public lands to establish a plan that sets a target for the annual volume of timber to be offered for sale over the next four years from federal land. Furthermore, it seeks to minimize “unnecessarily lengthy processes” and related costs tied to administrative approvals for timber production, forest management, and wildfire risk reduction treatments.
Kosman says benchmark softwood lumber 2x4 prices increased in mid-February, but the price trend line has generally been very stable. In the week ending Feb. 28, the price of the benchmark softwood lumber item—Western Spruce-Pine-Fir 2x4—was $525 per thousand board feet, up 18% from the previous week and up 18% from a month ago. Compared to a week ago, the benchmark softwood lumber price is 19% higher.
“Following the extreme volatility of 2020 to 2022, this return to a normal seasonal price changes annually up and down by approximately $150 thousand board feet was welcomed by producers and customers alike,” Kosman says. “The most important thing to note is that manufacturing volumes remain low compared to optimal. As mortgage lending interest rates were going up for the past two years, the demand for new housing starts was low. Now that interest rates will remain stable in the U.S. and are turning down in Canada, home buyer appetite is returning.”
