President Donald Trump’s tariffs have caused a rise in lumber prices, which homebuilders have warned will increase construction costs and translate into more expensive housing for U.S. consumers.
Lumber prices hit their highest level in two-and-a-half years this week and lumber futures are up more than 14% year to date as of Wednesday amid the worries over tariffs. Those developments come after Trump signed an executive order earlier this week launching a national security investigation into “vulnerabilities in the wood supply chain from imported timber, lumber, and their derivative products being dumped onto the United States market.”
That investigation could result in higher anti-dumping tariffs on Canadian lumber being imposed later this year. That would be in addition to the 14.5% anti-dumping and anti-subsidy tariff on Canadian softwood lumber that was in effect prior to Trump returning to the White House in January, and the 25% tariff on Canadian imports, including lumber, that took effect on March 4. Taken together, that pushed the overall tariff on Canadian lumber to nearly 40%.
Though Trump has also issued an executive order to expand domestic logging, the higher tariffs on Canada – the dominant source of U.S. lumber imports – have raised concerns among homebuilders about higher materials costs impacting the affordability of housing for Americans.
The National Association of Home Builders (NAHB) noted that the U.S. imported about $8.5 billion in sawmill and wood products in 2023, with nearly 70% of those imports (or $5.8 billion) coming from Canada.
NAHB Chairman Carl Harris issued a statement on Trump’s tariffs that read: “On President Trump’s first day in office, he issued an executive order directing departments and agencies to deliver emergency price relief by pursuing actions to lower the cost of housing and increase housing supply. This move to raise tariffs by 25% on Canadian and Mexican goods will have the opposite effect.”