Trump slaps tariff on Canadian softwood lumber

a reply to: tebyen

Where do you think lumber comes from?

a reply to: seasonal

when he raises the cost Canadian lumber up 20%, canada stops shipping as much. they won't ship as much because it's cost them more than they can make on it,or they will either raise the cost of lumber to cover the cost as best they can. this will increase the cost of domestic lumber because there is only so much that can be produced at a certain speed in the U.S. this is where supply and demand comes into effect, less lumber means higher cost. higher cost for lumber means higher cost for building. higher cost for building means higher cost for new homes. higher for new homes means higher cost for existing homes. higher cost for existing home means higher cost for renting.

watch the cost of lumber and then watch the cost of new and existing homes, i guarantee you the cost is going to go up.

a reply to: hounddoghowlie
Oh I agree with the theory. But I think we are long past the supply demand controlling prices. This maybe a super good reason for lumber companies and suppliers to to jack prices, profits could swell and this is good for US based timber co's, and they are more than likely the same ones who own the Canadian lumber co's.

a reply to: seasonal

But I think we are long past the supply demand controlling prices.

that is wrong all you have to do is look at the price of oil, when the U.S. started producing more oil again the price went down, and when something happens in the middle east that threatens supply it goes up, hell even when there is a hurricane hundreds miles away from oil rigs the price goes up.

and you see that in other products also, hell you see it in the grocery store.

the profits for lumber companies are not going to make it any better for the working man/ woman. their not going to pass the profit on in big enough increases in pay to cover the raising cost of buying a home. maybe for renting but not for buying.

a reply to: hounddoghowlie

its called using leverage to negotiate better deals for Americans

Canada isn't going to put its lumber industry at risk and will drop tariffs

a reply to: toysforadults

Well said.

People are so concerned that the product price is going to go into orbit. But the corps need us, maybe more than we need them. The end result is they need to sell stuff and it will get ironed out.

As if the new housing market isn't depressed enough...Trump has to pull this BS. Some businesman....How many contractors will this put out of business?

I've always said "if I have to pay more knowing another American is employed then so be it" it's something I willingly go along with.

I am in middle of building and have a stake in this, I also have lots of neighbors dependent on lumber industry.

Some give a crap only that contractors bottom line is maintained, guess what, all that cheap lumber and illegal labor has not done a thing on actual retail pricing, nope, just enhanced profit of builders.

Doesn't matter product, I'll always buy domestic first.

I have same opinion on food, textiles and goods. I'll gladly pay more as market adjusts to domestic commodity use and labor.

When true full employment happens or true shortage of commodity exists then we can talk about imports.

a reply to: Phoenix

You are 100% correct. The savings in any process, labor or import is not passed on to the consumer. It is kept by the companies.

Supply and demand is (mostly) dead.

A real lot of our SPF comes from Canada. His actions will raise the price of lumber a lot. Our lumber producers here can compete with Canada in price. We just do not have that many good forests to get lumber from here anymore. We use way more lumber than we can produce.

I would say a five percent tarriff would be something to consider, but not twenty percent. Trump knows little about this issue, he should actually look at all the facts before doing this. It is not like milk, we can produce more milk, so can they.

Canada will just put an export tax on the wood it sells here in America, we need to work with canada on this issue or we will not have any trees left.

I guess I better fire up my sawmill to cut my own lumber.

This is a very dumb move on the part of the Trump administration, with all the damage from weather events there will be a severe negative effect on our people.

Maybe I should go buy fifty 2x4s to put into stock. I presently don't have any. I do have some one by and five quarter. Lots of oak boards and some maple and cherry boards but I have very little 2 by anything.

It's silly to make building materials so much more expensive in your own country. Putting tariffs on finished products from other countries in order to encourage production within the country makes sense, this is only going to hurt the american peoples ability to thrive.

originally posted by: seasonal
a reply to: Phoenix

You are 100% correct. The savings in any process, labor or import is not passed on to the consumer. It is kept by the companies.

Supply and demand is (mostly) dead.

Even playing the market on a light weight level, it's so apparent that speculation and market manipulation rules ALL commodities.

a reply to: rickymouse

The artifical lack of timber in US is a resource management problem - not an actual shortage.

a reply to: olaru12

Super Bush II put oil on the speculative market.... Hurray.

a reply to: Phoenix

America has very large forests and there is a huge divide between timber co's who in the past have not been very good stewards and nut bag environmentalists that get listened to.

The price of lumber suffers under ignorance.

I don't think Trump realizes this kind of stuff is just going to inspire people to spurn American-made goods out of irritation. I mean, we're not even going after the right economy-suck here. We probably should be raising tariffs a bit on Asian-made stuff in general (hi, CHINA) Slapping Canada seems to be willfully missing the economic elephant in the room.

originally posted by: wheresthebody Putting tariffs on finished products from other countries in order to encourage production within the country makes sense.

Got that part right.

To those carping about residential construction, let me ask,

How much of a new homes cost does lumber constitute?

Especially in insane markets where cookie cutter tract homes are $500,000 plus or more in cost.

California?

In my market where sanity rules the day and we don't pay eco-terrorist taxation, code making and restrict building via eco-zoning lumber cost on new home is $35,000 to $60,000 on new home which is far less than 1/3 of cost.

In areas suffering severe eco-terrorism the lumber cost is 5-10% of total which is absolutely indicative of artifice in market.

It's a load of "snip" to claim housing industry will be depressed by tariff - only depression will be stockholder returns of corporate builders.

a reply to: Nyiah

Personally I'd like an E.O. saying 10 fewer container ships dock each day from a certain Asian country until currencies are on par and a certain pest is removed from power on a peninsula near that Asian country.

The lumber issue shares the problem in that past presidents kicked can down road instead of taking action.

Now that we have a leader taking action folks are carping about their little niches instead of taking wider longer veiw.

a reply to: Phoenix

Last time we actually looked into buying a plot of land & building a home from the ground up, framing said home took up around 60% (minimum) of the cost of building.

So yeah, this does spank builders & run the risk of depressing the industry while jacking up the housing costs even further.

Edit: That also included labor costs, not just wood alone, which I don't think you're factoring in. As a general rule of thumb from my dad (who did remodeling work) always said framework, including labor, is no less than half the cost of building a home.

For years now Lumber from Canada has been cheaper per board foot then logs are here in the US. Irving is a huge Canadian conglomerate that has several very large Lumber Mills here in Maine. I haul out of them on a regular basis. They probably will just start shipping more logs down here from Canada because there probably will not be a tariff on the Logs... just the finished lumber. So I don't see this move hurting Irving too much.

Eta...Although it will hurt the workers at the Canadian sawmills...