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,” global wood analyst Russ Taylor wrote. Taylor cites Nic Wilson, CEO of the Denver Group Mass Timber Summit in the US. In an email to BIV, a spokesperson for West Fraser said: “West Fraser has not issued blanket emails to customers regarding potential Trump tariffs.” …Whether the warning letters are real or rumour, it underscores the uncertainty roiling lumber markets as a result of Trump’s tariff threats. There could be some “panic buying” as American buyers try to build February and March inventories at current prices in anticipation of a 25% spike, Wilson writes.
Related coverage in the Globe and Mail: Canadian sawmills brace for Trump’s threatened tariffs on top of existing softwood lumber duties
A potential hike in tariffs imposed on Canadian exports to the US as early as January will highlight developments that could define first-quarter trends in the softwood lumber market. …Many traders have expressed a perception that the US economy will prosper in 2025 with a more business friendly administration in the White House. However, if the tariffs are imposed, they could significantly alter the flow of softwood lumber and panels from Canada to the US. Some Canadian producers have already noted that they will withdraw from the US market rather than deal with the rising costs. If returns on shipments to the US plunge, many Canadian mills could funnel a larger percentage of production offshore, especially to Pacific Rim destinations. …Southern Pine traders hope the first quarter sets the stage for a rebound after a difficult year in 2024. Production outpaced demand for most of the year, sustaining steady downward pressure on prices.
Canada recorded a ninth consecutive monthly trade deficit in November, albeit smaller than expected as exports rose faster than imports, data showed on Tuesday. Total exports rose 2.2 per cent in November, helped by gains in a broad section of product categories, while imports were up 1.8 per cent, led by consumer goods and chemical, plastic and rubber products, Statistics Canada said. As a result, Canada’s trade deficit narrowed to $323-million from a revised $544-million deficit in October. Analysts polled by Reuters had expected a $900-million deficit in November. The trade surplus with the United States, by far Canada’s largest trading partner, widened to $8.2-billion from $6.6-billion in October. The surplus with the U.S. nearly offset Canada’s trade deficit with all other countries – which widened to $8.5-billion in November from $7.2-billion – underscoring the potential impact of the U.S. President-elect’s threat to impose tariffs on Canadian goods.
Lumber prices have rebounded to around $560 per thousand board feet, up from a seven-week low of $531 on December 16th, driven by strong demand and supply constraints. U.S. existing home sales rose by 4.8% in November, the highest in eight months, reflecting growing momentum in the housing market, with more buyers entering as job growth continues, housing inventory rises, and consumers adjust to mortgage rates between 6% and 7%. Additionally, building permits surged by 6.1% in November, the highest level since February 2024, signaling strong future construction activity. On the supply side, production cuts and mill closures are restricting lumber availability as Western Forest Products reduced output by 30 million board feet, and Canfor Corp. shut two mills, cutting annual production by 670 million board feet. These supply limitations, coupled with U.S. tariffs on Canadian softwood lumber and rising import tariffs amid the China trade dispute, are pushing prices higher. [END]
VANCOUVER, BC — West Fraser Timber declared a quarterly dividend of US$0.32 per share on the Common shares and Class B Common shares in the capital of the Company, payable on January 14, 2025 to shareholders of record on December 27, 2024. Dividends are designated to be eligible dividends pursuant to subsection 89(14) of the Income Tax Act (Canada) and any applicable provincial legislation pertaining to eligible dividends.
Predictions for 2025 include: Energy output will jump… we’ll stop talking about hybrid work… maybe… the education boom will end… the north will struggle to retain population… we’ll stop ignoring the provincial deficit. …The outlook for f
After a dismal 2023 and 2024 in lumber markets in both demand and prices, it can only get better in 2025, right? Well, that depends. …The outlook for 2025 needs to incorporate several variables:
ONTARIO — Housing starts over the next few years will likely weaken and the already dire supply shortage could get even worse, warns a new report prepared for the Residential Construction Council of Ontario (RESCON). Further, employment in new residential construction has peaked and will likely keep declining for the next several years at least. Entitled Housing Market Outlooks in Ontario, the report from economic research firm Will Dunning Inc. concludes that new housing starts will continue to decline “well into 2025, followed by a slow recovery of the economy and housing activity during 2026 to 2028. By the end of 2028, conditions will not have fully recovered.” Richard Lyall, RESCON president, described the findings as “particularly worrisome for builders as they point to a weakening residential construction market at the very time we need to build more housing.
US mortgage rates climbed closer to 7%, threatening to squeeze buyers trying to crack into the housing market. The average on a 30-year mortgage rose to 6.91% as of Jan. 2, up from 6.85% a week earlier, according to Freddie Mac data released Thursday. A measure from the Mortgage Bankers Association advanced 8 basis points to 6.97% in the period ended Dec. 27, a nearly six-month high. High borrowing costs are weighing on affordability. …“It’s not exactly a good way to start the new year,” said Odeta Kushi, deputy chief economist at First American Financial Corp. “Industry experts are coming to the consensus that 2025 is another year of higher for longer for the housing market. It’s not great news.” Mortgage rates tend to track Treasury yields, which continued to climb in late December after Federal Reserve policymakers projected a slower pace of interest-rate cuts in 2025 amid sticky inflation.
Rollercoaster market moves in the final days of 2024 offered a blunt reminder that investors are heading into a year of living dangerously. Stocks and bonds lurched lower after the Federal Reserve’s final policy meeting of the year, spooked by the notion that the central bank may be unable to keep cutting rates (as it had previously expected to) because of still-simmering inflation. The key is what Fed chair Jay Powell was careful not to say but what every fund manager knows: Donald Trump’s economic agenda could be bad for growth, fuel inflation, or even both. So for the first time in many years, investors have what they call “two-way risk” in the Fed policy. The central bank might be able to keep on cutting — the hunch is that this would be Trump’s preference. But it’s not outlandish to suggest it might start raising rates again instead. 
The Forest Service sells timber that can be used to build homes and make paper products, among other things… Goals for timber sales are set yearly but the Forest Service has missed those goals by about 10% in recent years. According to the agency, factors such as staffing and buyer interest affected timber sales… The Forest Service’s average timber target was about 6,281,000 hundred cubic feet (CCF) per year, and its average amount of timber sold was about 5,590,000 CCF per year, from fiscal years 2014 through 2023. The Forest Service did not meet its targets for the amount of timber sold for any of the years from fiscal years 2014–2023. Full report available 
WASHINGTON — U.S. single-family homebuilding rebounded in November as the drag from hurricanes faded, but the threat of tariffs on imported goods and potential labor shortages from mass deportations could hamper new construction next year. Single-family housing starts, which account for the bulk of homebuilding, jumped 6.4% to a seasonally adjusted annual rate of 1.011 million units last month, the Commerce Department’s Census Bureau said. Data for October was revised to show homebuilding declining to a rate of 950,000 units from the previously reported pace of 970,000 units. …A National Association of Home Builders survey on Tuesday showed a measure of sales expectations in the next six months surging in December to the highest level since April 2022. …But economists were less enthusiastic, warning of even higher lumber prices and severe worker shortages if Trump followed through with tariffs and expulsions of undocumented immigrants, which would undermine the housing market.
Building Permits – Privately-owned housing units authorized by building permits in November were at a seasonally adjusted annual rate of 1,505,000. This is 6.1% above the revised October rate of 1,419,000. Single-family authorizations in November were at a rate of 972,000; this is 0.1% above the revised October figure of 971,000. Authorizations of units in buildings with five units or more were at a rate of 481,000 in November. ..Privately-owned housing starts in November were at a seasonally adjusted annual rate of 1,289,000. This is 1.8% below the revised October estimate of 1,312,000. Single-family housing starts in November were at a rate of 1,011,000; this is 6.4% above the revised October figure of 950,000. The November rate for units in buildings with five units or more was 264,000. …Privately-owned housing completions in November were at a seasonally adjusted annual rate of 1,601,000. This is 1.9% below the revised October estimate of 1,632,000. 
The inventory destocking that occurred in virtually every industry in 2023 is coming to an end. Destocking occurred as supply chains normalized in a post-COVID world.
BOSTON — Placing tariffs on Canadian products entering the U.S. would be “devastating” to the New England economy, Gov. Maura Healey said during an interview with the Herald this month. …Massachusetts relies heavily on Canadian lumber for building homes, and another Trump pledge to enact an additional 10% tariff on Chinese products would stymie local efforts to spur the energy and advanced manufacturing industries, Healey said. “Where does our lumber come from? A lot of it from Canada. So this really hurts. And it’s not just Canada. Look at China. We’re trying to lean hard into technology, applied AI in the state,” Healey said. “There are a lot of component parts that, sure, we want one day to be made here in America but right now they’re made overseas. So tariffs would really hurt our state.” “It would be devastating for the New England economy if President Trump imposes tariffs,” the governor added.
DUBLIN, Ireland —The housing affordability crisis that has frustrated young Americans for a decade has now taken hold in many big cities in Europe and beyond. The common threads: robust job growth, rising demand and not enough new development, causing rents and sales prices to rise faster than wages. Globally, homes are now less affordable than they were in the run-up to the 2008 housing crisis. …The resulting housing crunches are eroding living standards for poor and middle-class workers, intensifying wealth inequality and stoking political tensions. …In the 50 years through 2021, the countries with the sharpest rise in home prices around the world have been New Zealand, the U.K., Canada, Australia and Ireland. …Politicians in Canada, the U.K., Australia, Germany and South Korea are trying to boost construction by easing rules, including opening up undeveloped land for construction. National governments, though, are hamstrung by state and local rules that favor existing homeowners over renters, Hughes and Hilber said.