The US decision to ramp up duties on Canadian softwood lumber has implications for the entire North American industry and beyond. Lumber production has slowed in the past year and stakeholders on both sides of the border are grappling not just with fluctuating trade policies, but continuing challenges in the US construction sector.
Softwood lumber production in North America has continued its downward trend, with a 3% year-over-year decline in the first five months of 2025. Canadian sawmills have seen the steepest production drops in percentage terms.
Meanwhile, US imports of softwood lumber from Canada fell by 8%, although imports from European countries have risen.
A major flashpoint has emerged with the US decision to significantly increase duties on Canadian softwood lumber—more than doubling the combined rate to over 35%. This move has sparked strong reactions from industry leaders, trade groups, and construction advocates.
While some US stakeholders support the hike as a protective measure, others warn of rising costs, supply chain disruptions, and the need for a negotiated resolution. The debate underscores the complex interdependence between Canadian supply and US demand.
Beyond the trade dispute, broader economic indicators are painting a mixed picture. Lumber prices are climbing, builder sentiment remains subdued, and consumer confidence is slipping amid inflation concerns. On the other hand, housing starts have shown a modest rebound.
These trends reflect the multifaceted challenges facing the construction and forest products industries today.
This snapshot only scratches the surface of the evolving lumber landscape. For a deeper dive into production data, pricing trends, policy impacts, and expert commentary, download our full Market Insight report “Canadian Lumber Faces Steep US Tariffs Amid Ongoing Trade Tensions.”