Kevin Mason
The US tariff regime is far from over despite a US Supreme Court ruling striking down last year’s tariffs authorized by President Trump under the International Emergency Economic Powers Act (IEEPA). Although the court noted in its ruling that the president overstepped his authority in applying reciprocal tariffs on virtually all trading partners, it did leave the door open for other means of tariff application—and the US Administration has wasted no time in charging through that door, turning to Section 122 of the Trade Act of 1974 to impose new global tariffs of 10% (likely moving to 15%). Tariffs under Section 122 expire after 150 days without congressional approval, but we assume other options will be put in place before expiry (Section 232, 301 or some other creative mechanism).
With respect to the forest products industry, cessation of IEEPA tariffs and application of these new Section 122 tariffs have no impact on existing lumber duties (35% remains intact), nor for any existing tariffs under Section 232 (at 10%) or goods currently compliant under USMCA (such goods remain tariff-free under Section 122). Although USMCA-compliant goods are safe from tariffs for now, with that trade deal being reviewed this summer the tariff-free flow of goods among the US, Mexico and Canada could be upended. Since almost all newsprint supply comes from Canada (see page 19), that fear is ostensibly already causing U.S. buyers to accelerate purchases. Our table details what we know at the moment about the new tariff regime (Section 122 at 10% but probably moving to 15%). Brazil and China appear to be winners in these latest moves, but, with other mechanisms available to Trump, we don’t think these recent tariff reductions are going to lead to any dramatic increase in imports from these countries (uncertainty seems to be part of the goal under Trump’s methods).
The Musqueam First Nation’s agreement with Ottawa to advance the nation’s rights and title over an area that spans the western half of Greater Vancouver will force Canada to grapple with overlapping Indigenous claims, the boundaries of civic governance, and the principles of co-operative federalism. The deal acknowledges the existence of constitutionally protected Aboriginal title and creates a framework to implement Musqueam’s rights and title in their traditional territory. It is accompanied by two other agreements that create a framework for shared decision-making over fisheries, marine stewardship and land use. Just where that title will be recognized, and what rights will be affirmed, are yet to be negotiated. The Musqueam’s traditional territory has overlapping and shared territories with its First Nation neighbours. …Ottawa’s deal with Musqueam First Nation raises alarm about property rights in Vancouver area. …Cowichan decision leads to another claim on private lands in BC. [to access the full story a Globe & Mail subscription is required]
Conifex Timber announced that its wholly-owned subsidiary Conifex Mackenzie Forest Products has completed a $19 million secured term loan with the Business Development Bank of Canada (BDC) under the Softwood Lumber Guarantee Program. The loan has a maturity date of July 15, 2033. …The loan allows for interest-only payments until August 2028. A portion of the loan was used to repay a bridge advance from Conifex’s existing senior secured timber lender. The balance of the loan is available for working capital and general corporate purposes. Conifex also announced that it successfully restarted its sawmill in February. With the successful completion of the term loan, the Company is progressing toward normalized operations and currently anticipates sustaining two-shift operations in the second half of 2026, subject to fibre supply conditions.
Twenty years after spinning out Canfor Pulp Products as a separate entity, Canfor Corp. plans to bring it back into the fold to prevent the subsidiary from sinking. …Since December, its stock has plunged to about $0.50 per share. A March 6 shareholder vote on a plan of arrangement is just one of the vital signs indicating how bad 2025 was for the forestry sector in general, and BC forestry companies in particular. …But B.C. has been particularly hard hit with sawmill and pulp mill closures due to its fibre constraints and higher operating costs. The most recent high-profile mill closure in BC was the Domtar pulp mill in Crofton at the end of December. BC pulp mills rely on wood chips from sawmills to produce pulp. But so many sawmills have permanently shuttered in B.C. in the last few years that pulp mills now struggle to find enough fibre to run their mills.
EAR FALLS, Ontario — No news is not good news when it comes to the future of the sawmill in Ear Falls. Mayor of the community Kevin Kahoot says he’s supposed to talk with Interfor, the owner of the mill, this week. “We have regular conversations in the last few months…every couple of weeks,” says Kahoot. “It’s been kind of status quo recently. They keep pushing markets and tariffs and those kinds of things. But I don’t see a lot of movement maybe until springtime.” The sawmill shut down indefinitely back in October throwing 150 people out of work. [END]
New Brunswick royalty revenues have plummeted by $45 million. It’s a figure that has forestry royalties on track to come in at an historic low in the current fiscal year. And it was a decision to significantly cut royalty rates made quietly by the Holt government last July that’s behind it. That’s as the government suggests it’s a move that’s successfully sheltered the industry from curtailments and closures that are being felt across the country. …The province moved to overhaul timber royalty rates in 2022 after acknowledging its former policy of charging forestry companies a flat rate for wood cut in public forests had failed to take advantage of a two-year explosion in international lumber prices. A new system created under the former Higgs government allowed for rates to rise and fall with the prices of various wood-based commodities. “As forest product markets improve in the future, royalty rates will index upwards,” Herron said.
A judge with the US Court of International Trade ordered refunds for companies that paid tariffs that were later struck down by the United States Supreme Court. …The Supreme Court ruling did not say whether there should be refunds, leaving companies that paid the duties to sue the federal government. In Wednesday’s decision in the New York trade court, Judge Richard Eaton said all importers who paid IEEPA duties are “entitled to the benefit” of the Supreme Court’s decision. Eaton was ruling specifically on a case brought by Atmus Filtration, a filtration company in Tennessee, but said he will be the only judge to hear cases about refunds. Eaton ordered the Trump administration to finalize import paperwork without charging companies the IEEPA tariffs. …A coalition of more than 1,000 small businesses called it a victory and called on the Trump administration to act swiftly. …The White House has not yet responded.
Fiber and glass are among the packaging substrates hardest hit by February closure and layoff announcements. Here are the North American facilities that have announced downsizing efforts:
The escalating crisis in the Middle East could extend transport times for Finnish forest industry products to Asia by several weeks. At the same time, freight costs may rise, and container availability could become increasingly uncertain. Iran has announced the closure of the Strait of Hormuz. According to international reporting, several major shipping lines have also paused or reduced traffic through the Suez Canal, redirecting vessels around Africa via the Cape of Good Hope on routes to Asia. The Strait of Hormuz is a critical artery for global oil trade, and disruptions there primarily push up energy prices. For Finland’s forest industry, however, access through the Suez Canal is more directly decisive. Approximately 20 percent of the forest industry’s exports go to Asia, and the majority of those shipments pass through the Suez Canal, says Maarit Lindström, Director and Chief Economist at Metsäteollisuus ry. 
NEOPIT, Wisconsin — A Neopit wood mill is closed Tuesday after it experienced an early morning fire. Menominee Tribal Enterprises says it lost its stacker building and associated equipment. Some lumber inventory was damaged in the fire as well. All employees are safe and no injuries were reported. Production operations are closed for the day as the organization assesses the damage and begins determining the next steps for recovery and continuity of operations. The Menominee Tribal Enterprises store and main office remain open and are operating during regular business hours.
VANCOUVER, BC – Canfor Pulp Products reported its fourth quarter of 2025 results. For the fourth quarter of 2025, the Company reports an operating loss of $85.6 million; net loss of $133.6 million. After taking into consideration adjusting and one-time items totaling $57.5 million, the adjusted operating loss for Q4 2025 was $28.1 million, compared to a similarly adjusted operating loss of $11.1 million in Q3 2025. …Jointly with Canfor, the Company announced in December 2025 it had entered into an Arrangement Agreement, where Canfor would acquire all of the issued and outstanding common shares of Canfor Pulp not already owned by Canfor, for either $0.50 in cash consideration or 0.0425 of a common share of Canfor. As announced in February 2026, Management’s forecasts indicate a breach of financial covenants is highly probableas early as March 31, 2026. Should the Proposed Transaction not close, the Company would re-engage with itslenders for further temporary relief while it works to undertake a restructuring process.
Mortgage rates continued to decline in February, dipping below 6% in the last week of February. According to Freddie Mac, the 30-year fixed-rate mortgage averaged 6.05% last month, 5 basis points (bps) lower than January. Meanwhile, the average 15-year rate declined only a basis point to 5.43%. Compared to a year ago, the 30-year and 15-year rates are lower by 79 bps and 60 bps, respectively. The 10-year Treasury yield, a key benchmark for long-term borrowing, held relatively steady for most of February with an average 4.18% – a marginal decrease of 2 bps from the previous month. However, yields fell significantly in the final week of February. …Following the recent escalation of conflict in the Middle East, the 10-year Treasury yield has shown signs of reversing course. Investors are closely monitoring how protracted the conflict may become and its potential implications for global energy markets. If oil prices rise significantly, inflation pressures could intensify, potentially pushing Treasury yields higher.
If enacted, the new legislation would aim to streamline tariff exclusions for goods used in home construction, help stabilize material pricing, and support efforts to expand housing supply nationwide U.S. Sens. Jacky Rosen (D‑NV) and Chris Coons (D‑DE) have introduced legislation aimed at easing construction costs and addressing America’s housing affordability crisis by excluding key homebuilding materials from tariffs imposed under the Trump administration. The Housing Tariff Exclusion Act would create a process to automatically exempt many building materials from current and future tariffs and allow importers to apply for exemptions on other essential construction inputs. The bill comes amid ongoing concerns that tariffs on imported materials such as lumber, steel, and other construction inputs have driven up costs for builders, contributing to higher home prices and exacerbating supply shortages. …The bill has garnered support from industry groups including the NAHB.
US equities tumbled on Tuesday, undoing a Monday equity comeback, as oil prices spiked again and traders began to worry the U.S.-Iran conflict could drag on longer than anticipated. The Dow Jones Industrial Average lost 1,238 points, or 2.5%. If that holds, it would mark the blue-chip index’s first 1,000-point decline since April 10, 2025. The S&P 500 slipped 2.2%, while the Nasdaq Composite was down 2.3%. Brent crude oil, the international benchmark, topped $84 a barrel, up 8% Tuesday following a 6% spike Monday. WTI crude jumped 8% to above $77 a barrel after a 6% jump as well on Monday. Iranian Revolutionary Guard commander said the Strait of Hormuz — the world’s most vital transit route for crude oil — is closed and that Iran would set ablaze ships attempting the route, Reuters reported, citing Iranian media.
After falling below 6%, matching their lowest level in several years, mortgage rates reversed course Monday, hitting their highest point in two weeks. The average rate on the popular 30-year fixed loan rose 13 basis points to 6.12%, according to Mortgage News Daily. It had fallen to a recent low of 5.99% on Feb. 23 and pretty much sat there all week. The drop was welcome news as the all-important spring housing market gets underway. Potential buyers have been sidelined by high home prices and concerns over the broader economy. Mortgage rates crossing into the 5% range broke an emotional barrier for some, suggesting buyers might jump at the opportunity. Mortgage rates loosely follow the yield on the U.S. 10-year Treasury, which rose back above 4% on Monday. The growing conflict with Iran caused a spike in oil prices, raising inflation worries and pushing yields higher.
Real estate professionals active in the Los Angeles market are bracing themselves for another wave of tariff-induced uncertainty following the US Supreme Court’s ruling. …Despite the Feb. 20 ruling, President Donald Trump has been adamant that he will find other avenues to impose his tariffs. Trump’s tariff policies have already caused upheaval for local businesses, and now the country’s heightened situation with tariffs will further disrupt L.A.’s real estate market, according to experts across development, manufacturing and finance. “This is a very shifting landscape for American companies,” said Ken Calligar, founder of RSG 3•D. …Garret Weyand, at Cedar Street Partners, said, “If costs are too high because of these tariffs, then projects don’t get built.” Banks will likely make borrowers increase the amount of equity so that the bank is covered in the event tariffs and inflation raise project costs.
PRINCE GEORGE – Recent shifts in the global wood pellet industry have started a debate in BC about forestry, climate impacts, and local jobs. Drax, a UK-based energy company, plans to stop using wood pellets from BC at its power plant in England. Environmental groups believe this move will not affect BC much, but the province’s Forest Minister disagrees. Ravi Parmar, BC’s forests minister, says critics are spreading fear and insists the industry uses byproducts from forestry, not old-growth trees. Michelle Connolly from Conservation North says that although Drax stopping shipments to the UK seems important, the situation in BC is actually much more complex. …Forest Minister Ravi Parmar says BC uses some of the world’s strongest sustainable harvesting practices. He adds that pellet plants use leftover byproducts from logging, not valuable logs from primary forests. 
OREGON — A historic state-tribal collaboration in Oregon has stalled after a charitable foundation pulled out of a potential land deal. The Oregon Department of Fish and Wildlife was preparing to purchase 11,438 acres of private timberland using a federal grant. The area is about 10 miles southwest of La Grande in the Blue Mountains. The agency planned to manage the land alongside the Confederated Tribes of the Umatilla Indian Reservation — the first such collaboration in Oregon. But the landowner, the Harry A. Merlo Foundation, has withdrawn from the deal “for undisclosed reasons,” according to the Oregon Department of Fish and Wildlife. The state wildlife department and tribes had secured $22 million in federal funding to acquire and co-manage the land. …The plan was to restore this swath of forests and meadows for elk and salmon habitat.
MONTANA — Three national forests east of Missoula are proposing a plan to require continuous logging across almost a million acres of southwest Montana for at least the next decade. On Monday, the U.S. Forest Service released a draft plan for a Tri-Forest Sustained-Yield Unit, which would direct logging to occur on more than 925,000 acres across the Beaverhead-Deerlodge, Helena-Lewis and Clark and Custer Gallatin national forests. The plan’s stated purpose is to “to support local economies and the timber industry.” Logging is predicted to ramp up to produce 35 million board-feet of lumber annually by the end of 10 years, according to the plan. … The plan says logging won’t occur in wilderness areas, recommended wilderness or wilderness study areas. …But some regional public land advocates are questioning the plan at a time when the Trump administration has pushed a number of other initiatives that favor the timber industry and reduce public comment.
