The total value of building permits rose 11.0% to $13.1 billion in December. The increase was led by a 21.2% increase in the residential sector, largely due to gains in Ontario and British Columbia. On a constant dollar basis (2017=100), the total value of building permits issued in December grew 8.8% from the previous month and was up 30.5% on a year-over-year basis. The total value of residential permits increased by $1.6 billion to $9.0 billion in December. Multi-unit construction intentions (+$1.5 billion) contributed the most to the gain, posting a 33.3% increase from the previous month. …The total value of building permits in the fourth quarter edged up $430.8 million (+1.2%) to $37.5 billion, marking the fourth consecutive, albeit slowest, quarterly increase in 2024. In the fourth quarter, the residential sector led the growth, while the non-residential sector retreated after reaching a record high level in the third quarter.
Canada’s economy added 76,000 jobs in January as the country braced for the impact of tariffs from U.S. President Donald Trump, marking the third consecutive month of jobs growth. The unemployment rate fell by 0.1 percentage points last month, bringing Canada’s unemployment rate to 6.6 per cent, with the largest gains (33,000 jobs) coming from the manufacturing sector, Statistics Canada said in its monthly labour force survey. The latest 
President Trump’s tariff plans threaten to raise US home construction costs, making it even more difficult for Americans already facing a tight housing market. Trump’s proposed 25% tariffs have been delayed until at least March, along with a 10% levy now in effect on products from China, could make building a typical home as much as $29,000 pricier, said David Belman, a second-generation homebuilder in Wisconsin. A large portion of that increase — as much as $14,000 — would come from the tariff on Canada, said Belman. …Current lumber inventories may only last one to two months, even with demand still weak and the US not yet in its peak building season, said Dustin Jalbert at Fastmarkets. “It’s not going to take long for prices to have to start moving higher here to keep the supply chain stocked,” Jalbert said. Lumber futures in Chicago slumped 4.6% Tuesday on news of tariff delays, erasing gains from the previous two sessions.
Lumber futures surged to over $590 per thousand board feet, approaching the two-month high of $600 from January 6th following US President Trump’s decision to implement tariffs on Canada, a major supplier of wood to the US. The tariffs were threatened by the US President shortly after taking office, but conflicting messages from the Presidential administration raised skepticism for investors on whether trade barriers would actually be raised. According to the latest data, Canada supplied around 30% of lumber used in the US last year. The 25% tax on Canadian goods, including wood, add to the already existing anti-dumping duties of 14.5%, raising capacity pressures on domestically produced alternatives. In the meantime, the greater degree of confidence that the Fed will deliver more than one rate cut this year drove benchmark mortgage rates to ease below 7%, giving some respite to construction demand. [END]
Framing lumber markets hovered in a holding pattern as traders embraced a wait-and-see approach to a potential 25% tariff on Canadian shipments. The Random Lengths Framing Lumber Composite Price finished the week $1 lower. Western S-P-F buyers moved to the sidelines in late trading, citing minimal immediate needs and uncertainty about the tariffs and near-term prospects. …Price weakness lingered in the Southern Pine market amid sluggish to stagnant sales. Buyers lacked urgency and the potential impact of tariffs on demand for SYP was a widespread topic of conversation. …Traders debated how much of a price spread between Western S-P-F and SYP would need to emerge before end users substituted species on a larger scale. …In Coast markets, Hem-Fir dimension continued to face serious downward pressure from soft Inland prices. Meanwhile, dry Douglas Fir dimension prices stabilized, assisted by a green market that has found its footing.
Canada’s central bank has cut interest rates for a sixth consecutive time as inflation remains around two per cent and the threat of U.S. tariffs looms. The 25-basis point cut comes as the Bank of Canada forecasts GDP growth will strengthen in 2025 if there is no trade war with the United States. Bank of Canada Governor Tiff Macklem said while tariffs are top of mind, they were not factors in the rate cut and the monetary policy report MPR). “Since scope and duration of a possible trade conflict are impossible to predict, the MPR projection we published today provides a baseline forecast in the absence of tariffs,” said Macklem. …Macklem says a protracted and broad-based trade war would hurt economic activity in Canada with the higher cost of imported goods putting direct upward pressure on inflation.
The Bank of Canada is being pulled in a few different directions ahead of its first interest rate decision of the year on Wednesday. On one hand, there are signs of trouble bubbling up in underlying inflation that could make an argument for keeping borrowing costs higher for longer. On the other: Donald Trump has reiterated threats to impose tariffs of 25% on Canadian goods that could be set to take effect mere days after the central bank’s rate decision. …A trade blow like that would normally push the Bank of Canada towards steeper rate cuts in a bid to salvage economic growth. But dropping rates too quickly at a time when the loonie is already struggling risks fuelling more inflation on imports from the US. Economists say they’re betting the Bank of Canada will go ahead with another cut.
Trends in many framing lumber markets were unchanged amid persistent uncertainty regarding tariffs and frigid temperatures across much of the US. …Western Canadian producers sold cautiously while awaiting clarity on potential tariffs. Buyers had few immediate needs and were content operating with lean inventories despite the threat of volatility. Prices were little changed in overall dull trading. Lumber futures tracked a similar course in terms of interest, but downside was evident as the large premium in the front month eroded. The board fell each day week to date. Meanwhile, subfreezing temperatures across the South and historic snowstorms along the Gulf Coast brought Southern Pine trading to a near standstill. Traders operated with widely diverse views of whether President Trump’s threats of tariffs of up to 25% on Canadian imports as early as February 1 will actually become a reality.
U.S. trade with Canada and Mexico is back in Trump’s crosshairs with the tariff threat. …Much of the focus has centered on autos but Canada is also the top trading partner of the U.S. for critical chemicals, an industry now bracing for the potential impact. …Mineral firms in Canada are considered domestic sources under Title III of the Defense Production Act and have received U.S. federal funding for critical minerals projects in Canada. …Canada is also the largest supplier of U.S. energy imports, including crude oil, natural gas, and electricity. …Rand Ghayad, chief economist at the Association of American Railroads, said the interconnected rail network between the U.S. and Canada is a cornerstone of North American trade, underpinning economic growth and supply chain resilience. …The inflationary effects from tariffs will take some time to materialize, as these costs will need to be passed through to end buyers.
Lumber prices fell toward $580 per thousand board feet, retreating from eight-week highs of $600 on January 16th, as the impending 25% tariffs on Canadian softwood lumber, set to take effect on February 1st, weighed on the market. These tariffs, imposed by President Trump, will increase the cost of Canadian lumber, which is a key input for U.S. housing construction, potentially reducing demand as builders face higher material prices. The price hike could discourage housing projects, especially as the broader construction sector slows. Trump’s executive orders aimed at stimulating U.S. housing production, including efforts to lower construction costs, may further dampen demand for imported lumber by promoting domestic sourcing. As Canada is the largest supplier of U.S. lumber, the tariff’s impact on supply and demand dynamics is expected to be significant, with builders likely seeking alternatives as lumber prices rise.›
Stocks in B.C.’s three major publicly traded forestry companies were predictably down this morning (February 3), when stock markets opened after this weekend’s declaration of a trade war between the U.S., Canada and Mexico. U.S. stock markets were jolted, too, Monday morning, as was the S&P TSX composite Index. The Canadian dollar fell to $0.68 to the American dollar following Saturday’s confirmation that Trump will hit Canadian imports with 25 per cent tariffs, and 10 per cent tariffs on Canadian energy imports, beginning Tuesday. North American stocks fell sharply in early morning trading before recovering somewhat. Canadian companies that are highly exposed to the U.S. were jolted, with companies like West Fraser Timber, Canfor Corp and Interfor Corp. experiencing early morning drops of four, five and six per cent respectively, before correcting somewhat later in the morning.
Calgary’s construction industry is hoping the threat of American tariffs doesn’t slow its momentum in 2025. …Bill Black, the head of the Calgary Construction Association, says when it comes to certain building materials, the tariffs could cause unrepairable damage. “Lumber suppliers selling are obviously going to feel a really significant impact on their volume that goes into the U.S.,” Black said. “The overall viability of the lumber business is based on a blend of the two markets, and if one market becomes unfeasible because of tariffs, that then puts pressure on the operating businesses. “That could impact their ability to service the Canadian market as well.” …The city has seen consecutive years of a record number of housing starts, and those in the sector don’t want to lose vital momentum. …Alberta’s forest ministry reiterated the importance of cross-border trade Friday, saying there’s still optimism a tariff-stopping solution can be found.
A 30-day delay in implementation of tariffs on Canadian shipments to the US reset recent trends in framing lumber markets. Sales picked up in most regions and species, but higher quotes early in the week retreated nearer to last week’s levels. Western S-P-F sales were mixed, but several secondaries reported their strongest days of the year as buyers padded relatively thin inventories with insurance loads. Prices remained close to last week’s levels, but supplies of some items tightened in late trading. Lumber futures swung from extreme volatility Monday and Tuesday to an upward trend towards the end of the week. The threat of tariffs drove prices up, but selling commenced after the delay. The biggest gains were posted in green Fir, where a supply-side rally pushed Std/#2&Btr dimension prices $15-35 higher. The Random Lengths Framing Lumber Composite Price posted another modest adjustment, finishing $5 higher. Most Southern Pine producers throttled back quotes.
The U.S. market accounts for 5-10% of Sweden’s forest industry exports, depending on the segment, meaning the direct impact of potential new tariffs remains limited, said Christian Nielsen, market analyst for wood products at Swedish Forest Industries Federation. The U.S. relies on imports for 25% of its lumber consumption, primarily from Canada. Higher tariffs on Canadian wood could raise costs for American consumers while improving the competitive position of European suppliers. However, Nielsen noted that future tariffs directly targeting EU exports remain uncertain. In the pulp and paper sector, the U.S. could rely entirely on domestic production, reducing the need for imports. Sweden currently exports 7% of its pulp and 5% of its paper and board products to the US. In total, Sweden exports 92% of its paper and board production, and global trade flows could be affected by tariff changes. [END]
The stock market fell on Monday after President Donald Trump slapped tariffs on Canada, Mexico and China, eliciting threats of retaliation and setting the stage for a trade war. The Dow Jones Industrial Average slid about 550 points, or 1.25%, in early trading on Monday. The S&P 500 dropped 1.5%, and the tech-heavy Nasdaq plummeted 2%. Traders demonstrated their jitters with a selloff of U.S. auto companies, which hold deep ties to suppliers in Canada and Mexico. Shares of General Motors plummeted 6%, while Ford saw its stock price plunge 4%. The market rout extended worldwide. Japan’s Nikkei index fell 2.5% on Monday, and the pan-European STOXX 600 dropped about 1%.
US Mortgage rates edged higher in January, with the average 30-year fixed-rate mortgage reaching 6.96%. Rates had been climbing steadily since mid-December—even surpassing 7%—before easing in recent weeks as the bond market stabilized following news that President Donald Trump postponed tariffs plans to February 1. According to Freddie Mac, the average rate for a 30-year fixed-rate mortgage rose 24 basis points (bps) from December, extending a two-year trend of fluctuations between 6% and 7%. Meanwhile, the 15-year fixed-rate mortgage increased 23 bps to land at 6.13%. The 10-year Treasury yield, a key benchmark for mortgage rates, averaged 4.63% in November—33 basis points higher than December’s average.
Homeownership has long played a starring role in the American dream. …Nearly nine in 10 homeowners (88% / 81% in 2025) in a survey said the true cost of owning a home is more expensive than they’d expected. …Recent, unexpected hurricane-related floods in Western North Carolina and massive fires across Los Angeles County, which both occurred after the survey was conducted, will surely raise costs even more dramatically this year, and not just in the affected regions. This will be due to fierce competition for construction supplies and labor as disaster-stricken areas compete for resources and everyone else looks to maintain and improve their homes. Tariffs, depending on how they’re applied – e.g., Canadian lumber for rebuilding or across-the-board Chinese imports hitting home improvement store shelves – and potential disruption to the construction workforce can also surge homeownership costs.
Lumber prices are 9.6% higher than they were one year ago. …Impact of wood and lumber prices on the cost of a new home: In addition to narrowly defined framing lumber, products such as plywood, OSB, particleboard, fiberboard, shakes and shingles make up a considerable portion of the total 
President Donald Trump’s proposal to implement significant tariffs on the country’s key trading partners could have ripple effects on the U.S. housing market. …The tariffs could drive up prices for new homes and renovations, further straining an already tight market. “The tariffs will raise the cost of materials, which could directly increase the cost of constructing new homes,” said Wayne Winegarden at Pacific Research Institute. Experts said tariffs are a tax that increases the costs of imported goods, including building materials. …Higher material and construction costs caused by the tariffs could make buying a home out of reach for many people. “The tariffs will slow down the economy and will also encourage the Federal Reserve to pursue a higher interest rate environment,” Winegarden said. …Together, the higher rates coupled with the rising cost of construction will significantly reduce housing affordability.”
Construction costs account for 64.4% of the average price of a home, according to NAHB’s most recent 
Year-end 2024 Southern Pine lumber (treated and untreated) exports hit 565.7 Mbf, which was up 11% over the previous year, according to December 2024 data from the USDA. On a monthly basis, Southern Pine lumber exports were up 21.9% in December 2024 over the same month in 2023 but down 2.2% from November 2024. …Softwood imports, meanwhile, were down 11.5% in December 2024 compared with the same month a year ago and down 11% from November 2024. …Mexico remains the largest export market (by volume) of Southern Pine and treated lumber, up 23% over 2023 with 150.2 Mbf of imports. The Dominican Republic, the No. 2 importer of Southern Pine, ended the year 19.1% ahead of 2023 with 92.3 Mbf. India’s total of SYP imports ended 3.1% ahead of last year with 36.6 Mbf. Canada: up 30% with 27.4 Mbf in 2024. Canada ended the year as the No. 5 importer of Southern Pine lumber (treated and untreated).
RUSS TAYLOR GLOBAL is pleased to provide the latest quarterly report from the 