Trump Orders Investigation into U.S. Lumber Imports
U.S. President Donald Trump has initiated a trade investigation that may lead to higher tariffs on lumber imports. This move could increase existing duties on Canadian softwood lumber and add to the 25% tariffs on all Canadian and Mexican goods set to begin next week.
National Security Investigation into Lumber Imports
Trump signed a memo instructing Commerce Secretary Howard Lutnick to investigate lumber imports under Section 232 of the Trade Expansion Act of 1962.
This law, previously used to impose steel and aluminum tariffs, allows the government to justify tariffs for national security reasons. The investigation, which will take up to 270 days, could impact derivative wood products like furniture, cabinets, and other items made from imported lumber.
Boosting Domestic Lumber Supply
In addition to investigating imports, Trump ordered measures to increase the U.S. lumber supply within 90 days. These steps include streamlining the permitting process for harvesting lumber from public lands and enhancing the salvage of fallen trees.
The directive also calls for updated guidance on forestry projects under the Endangered Species Act to speed up timber production.
Economic and National Security Justifications
White House trade adviser Peter Navarro stated that the probe aims to counteract large exporters such as Canada, Germany, and Brazil, which he claims flood the U.S. market with cheap lumber.
A White House official argued that relying on imported lumber poses a national security risk because the U.S. military depends on it for construction. The official did not specify the proposed tariff rate, but Trump has mentioned a possible 25% tariff on lumber and forest products.
Impact on U.S.-Canada Trade Relations
If imposed, the new tariffs would add to the 14.5% combined anti-dumping and anti-subsidy duties already in place on Canadian softwood lumber. These duties stem from a long-standing U.S.-Canada dispute over stumpage fees.
Canada charges low fees for harvesting trees on public lands, which the U.S. considers an unfair subsidy. American lumber is primarily sourced from private lands at market rates.
U.S. home builders have criticized the tariffs, saying they increase lumber prices and drive up home costs. Canada has formally challenged these duties under the U.S.-Mexico-Canada trade agreement’s dispute resolution system, arguing that they are unfair.
Broader Tariff Strategy
The lumber investigation is the third trade action Trump has taken in a week. Earlier, he launched a Section 232 investigation into copper imports, aiming to boost domestic production. He also ordered a review of digital services taxes in countries like Canada, France, and the U.K., which could lead to more tariffs on those nations.
Potential Economic Impact
The potential tariffs on lumber come as part of a broader effort to pressure Canada and Mexico on border security and fentanyl trafficking. If Trump follows through, tariffs could strain trade relations further and impact industries that rely on imported lumber.
The decision on new duties will depend on the findings of the Commerce Department’s investigation, expected later this year.
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