Wood industry | A tariff would be a “disaster” for Quebec sawmills

(Quebec) The imposition of a 25% tariff would represent a massive blow for the forestry industry and for the regions of Quebec. Lumber is already being hit hard by countervailing duties of nearly 15%, and any tariff would add up to create an explosive cocktail.

“Simply put, the tariffs would be on top of the countervailing duties, which would be devastating for the Canadian lumber industry,” warns Vancouver analyst Russ Taylor, an expert on the lumber industry. artwork.

Canadian and Quebec producers of lumber, which is used in particular for the construction of houses, are already going through a storm. They have been hit hard since 2017 by countervailing duties which are currently around 14.54% when they sell their wood in the United States.

In Quebec, several sawmills have announced their closure in recent months. According to 2022 figures, sawmills employ more than 10,000 workers in the province, not counting the thousands of jobs in forest harvesting.

However, the storm is not over. It may even get worse. This is because countervailing duties are reviewed annually. Analysts expect them to double in 2025 to around 30%.

“If there was a 25% tariff, that would be on top of any customs duties in place. So, for the export of Canadian lumber, that would make a total of 55% and it would be a disaster for Canadian sawmills,” warns Russ Taylor.

This fifth lumber conflict has been going on since 2017. The Americans believe that the origin of Canadian timber – largely public lands – constitutes a form of disguised aid, which Ottawa refutes.

Sit down with Trump

The Quebec industry is well aware of this scenario. Jean-François Samray, CEO of the Quebec Forest Industry Council, however, believes that the tariffs brandished by President-elect Donald Trump could very well never materialize. They would in a way be a way of negotiating.

“The Americans are not self-sufficient, if this scenario occurs, it will hurt everyone, on both sides of the border,” he argues.

“The president could by executive order impose tariffs. But one thing remains: the president was elected to give room to maneuver in the budget of the middle class, which has been hit by inflation,” says Mr. Samray.

But the Americans need Quebec and Canadian wood to build houses. The American National Association of Home Builders (NAHB) had already estimated that countervailing duties imposed by the United States on Canadian lumber increased the average price of a single-family home by approximately $1,800.

“In effect, the tariffs act as a tax on American home builders, home buyers, and consumers,” said an email to The Press le PDG de la NAHB, Jim Tobin.

The NAHB has long called for Ottawa and Washington to negotiate and agree to end this fifth softwood lumber conflict.