Lumber prices surged to around $580 per thousand board feet in January, marking a six-week high, as uncertainty surrounding potential tariffs on Canadian softwood lumber imports to the U.S. stoked panic buying. The looming 25% tariff proposed by President-elect Trump has prompted U.S. buyers to rapidly secure inventories ahead of anticipated price hikes, further escalating demand. With Canadian lumber already subject to an average 14.4% import duty, the additional tariff is expected to push prices even higher. U.S. reliance on Canadian softwood lumber remains substantial, as Canada supplies a significant portion of the country’s lumber needs. While alternative suppliers, such as Germany and Sweden, may partially fill the gap, they lack the capacity to match Canada’s production in the long run. Meanwhile, domestic challenges, including workforce shortages and sawmill closures, are limiting U.S. production, contributing to ongoing supply constraints. [END]
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,” 
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.
New support for forest-sector manufacturers throughout the province will create and protect jobs, strengthen local economies and diversify the range of fibre sources used to manufacture high-value, made-in-B.C. forest products. “The BC Manufacturing Jobs Fund is partnering with forestry companies throughout the province to grow and stabilize their operations and get the most out of our fibre supply, while producing more made-in-B.C. engineered wood products,” said Diana Gibson, Minister of Jobs, Economic Development and Innovation. Through the BC Manufacturing Jobs Fund (BCMJF), the Government of B.C. is contributing as much as $5.1 million toward seven forest-sector capital projects and five planning projects in communities throughout the province. Cedarland Forest Products Ltd. in Maple Ridge will receive as much as $1.3 million… Gilbert Smith Forest Products in Barriere will receive as much as $1.1 million…
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:
The NAHB/Westlake Royal Remodeling Market Index (RMI) posted a reading of 68 for the fourth quarter of 2024, up five points compared to the previous quarter. Remodelers are more optimistic about the market than they were earlier in the year, corroborated by NAHB’s recent analysis of home improvement loan applications. Demand in many parts of the country was stronger than usual for the fall season, especially demand for larger projects, with leads coming in after the uncertainty about the November elections was removed. …The Current Conditions Index averaged 75, increasing three points from the previous quarter. All three components remained well above 50 in positive territory: large remodeling projects rose eight points to 75, moderate remodeling projects increased two points to 73, and small remodeling projects inched down one point to 76. …The Future Indicators Index was 61, up six points from the previous quarter. 
A report released by the Commerce Department on Friday showed new residential construction in the U.S. surged by much more than anticipated in the month of December. The Commerce Department said housing starts soared by 15.8 percent to an annual rate of 1.499 million in December after tumbling by 3.7 percent to a revised rate of 1.294 million in November. …The spike by housing starts came amid a substantial rebound by multi-family starts, which skyrocketed by 61.5 percent to an annual rate of 449,000 in December after plummeting by 30.7 percent to an annual rate of 278,000 in November. Single-family starts also shot up by 3.3 percent to an annual rate of 1.050 million in December after surging by 7.7 percent to an annual rate of 1.016 million in November. Meanwhile, the report said building permits slid by 0.7 percent to an annual rate of 1.483 million in December after surging by 5.2 percent to a revised rate of 1.493 million in November.
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.