President-elect Donald Trump has justified his threat of 25% tariffs on Canada by pointing to the US trade deficit. Top Canadian economists have a response to that: it’s all because your country wants cheap oil. The US is on track to end 2024 with the largest overall trade deficit in its history. Its imbalance with Canada is about $60 billion. …Trump has repeatedly claimed the deficit is a subsidy to the Canadian economy, and said Tuesday the US doesn’t need anything from Canada. Import and export data, however, paint a different picture. Among the US’s top partners, its trade with Canada is the most equally balanced — because Canada buys $85 million from the US for every $100 million it exports. When stripping out oil and gas, the US actually has a significant trade surplus with Canada — its biggest energy supplier and a key buyer of American products from food to machinery.
With President-elect Trump set to take over the Oval Office on January 20, the Canadian lumber industry looks to be taking action… advising customers that they will add 25% to lumber exports to the US when the tariff is announced. With Canadian mills already paying an average of 14.4% import duties on US shipments, they have no alternative but to increase prices by the 25% to cover the potential tariff. Nic Wilson, CEO of the Denver Mass Timber Group Summit reports that… “
Nicolas Schmitt, an economics professor at SFU, highlighted that the province’s economy has shifted from a goods-based to a service-driven model. He said this transition has made the economy more diversified and resilient. With key regions like Vancouver and the Okanagan Valley showing strong growth in service sectors, B.C. is well-positioned to withstand global economic uncertainties and to continue thriving. “This war might affect more interior B.C. than urban B.C. That is a potential problem for the interior. Where those lumber mines and all those goods are being exported. So that creates an urban rural divide.” In a statement provided by Kurt Niquidet president of the B.C. Lumber Trade Council, he said federal parties must collaborate to tackle the ongoing softwood lumber duties and the potential imposition of further tariffs. …While B.C.’s diversified economy offers resilience, the potential impacts on industries like lumber, especially in rural areas, require attention. 
U.S. president-elect Donald Trump’s increasingly bold threats against Canada’s economy and sovereignty suggest “there’s something dangerous brewing” and a serious response is needed, a U.S. analyst says. David Frum, a staff writer at The Atlantic who has covered U.S. politics for decades, doesn’t believe Trump actually wants to make Canada a U.S. state, but says the fact the incoming president keeps repeating that idea means he’s eying some kind of aggressive action. …Frum said Canadians should brace for that “tariff aggression,” which Trump can pursue with several unilateral actions, including declaring a national emergency to justify them. He added Canada will also be impacted by Trump’s aggression toward Latin American allies, particularly Mexico. Canada may also soon see the arrival of thousands of people fearing deportation from the U.S. seeking refuge from Trump’s pledged crackdown on illegal residents and immigration, Frum said.
Advisors on Trump’s incoming economic team are considering a gradual implementation of tariffs, increasing them incrementally each month. This approach is intended to strengthen their negotiating position while minimizing the risk of sudden inflation, according to sources familiar with the discussions. One concept involves a plan to raise tariffs by 2% to 5% per month, using executive powers granted under the International Emergency Economic Powers Act. The idea is still in its early stages and has not yet been formally presented to Trump, indicating that the strategy is in the initial phase of consideration. Trump has not yet approved of the plan. Supporters include Trump advisors Bessent, Haslett and Miran. [to access the full story a Bloomberg subscription is required]
Cabinets made in China were rerouted through Malaysia and ended up in U.S. kitchens—sparking a Customs probe. …Imported cabinets make up most of the $37.5 billion U.S. market. In 2018, the Trump administration imposed tariffs on Chinese-made cabinets as part of broader tariffs, rerouting the flow of those goods. In 2020, the Biden administration slapped them with up to 262% in antidumping duties, a penalty imposed on imports judged by the U.S. to be sold for below fair value. In response, Haiyan and other Chinese companies have moved operations or established new facilities in countries such as Vietnam, Malaysia or Thailand, where they can send raw materials to make goods. Some companies have used these countries as temporary holding places where they can mask the origin of goods, according to CBP investigations. …“It’s kind of a shell game,” said Betsy Natz of the Kitchen Cabinet Manufacturers Association. [to access the full story a WSJ subscription is required]
The mere threat of tariffs being tacked onto Canadian lumber imports in the U.S. is raising fears of panic buying that could roil lumber markets and prices. “A number of Canadian lumber companies are now advising customers that they will add 25% to lumber exports to the U.S. when the tariff is announced,” 
As we close the 2024 chapter, we wanted to share a recap of the top stories from the SLB last year. As we continue to work towards our mission to make softwood lumber the building material of choice in the United States, we reflect on the impact the SLB and its funded programs made last year. 
USA BioEnergy (USABE) announced it has closed on the acquisition of 1,600+ acres of land in East Texas for its new $2.8-B advanced biorefinery, designed to convert wood waste into sustainable, net-zero aviation fuel (SAF). The landmark SAF facility already secured a 20-year offtake agreement with Southwest Airlines and is at the forefront of advancing ultra-low-carbon fuel, which is much needed in the future of aviation… Once blended with conventional jet fuel, the SAF could produce the equivalent of 2.59 billion gallons of net-zero fuel and avoid 30 million metric tons of CO2 over the offtake agreement term. According to USABE calculations this will enable approximately 112,000 short (less than three hours) or 7,000 long haul (more than 10 hours) net-zero airline flights per year.
Firefighters in southern California are battling the Palisades and Eaton Fires. …Residents of many fire-prone areas have grown familiar with the orange, apocalyptic haze of wildfire smoke as these blazes have become more common because of climate change. Such smoke can contain an unpredictable cocktail of chemicals associated with heart and lung diseases and even cancer, which is the leading cause of death among firefighters. Here’s what makes wildfire smoke so dangerous. When trees, shrubbery and other organic matter burn, they release carbon dioxide, water, heat—and, depending on the available fuel, various volatile compounds, gaseous pollutants and particulate matter. Those tiny particles, which become suspended in the air, can include soot (black carbon), metals, dust, and more. If they’re smaller than 2.5 microns in diameter, they can evade our body’s natural defenses when inhaled, penetrating deep into the lungs and triggering a wide variety of health problems.
Foreboding weather forecasts keep tensions high in Los Angeles as one of North America’s largest cities battles wildfires that have already claimed at least two dozen lives and thousands of homes. Here are some data points that put into context the peril the city is in. The most destructive fires in California history — and how they compare to Canada’s largest wildfire: Palisades and Eaton fires are already among the most destructive in California’s history, scorching more than 10,000 structures in just a matter of days. With persistent winds in the forecast, those numbers could climb even higher. For context, Canada’s most devastating wildfire — in Fort McMurray, Alta., in 2016—destroyed an estimated 2,400 structures.
Fires burning homes and businesses in Los Angeles for a week have killed at least 24 people, displaced thousands of others and destroyed more than 12,000 buildings in what might be the most expensive conflagrations in the nation’s history. The blazes started Jan. 7, fueled by fierce Santa Ana winds that have posed problems for the large forces of firefighters deployed across several areas of the sprawling city. Cal Fire reported that the Palisades, Eaton, Kenneth and Hurst fires have consumed about 63 square miles (163 square kilometers). Investigators are still trying to determine what sparked the fires. They could be the nation’s costliest ever.