New Tariffs On Lumber, Wood Product Imports Add Headwinds To Housing Market
The National Association of Home Builders (NAHB) recently reported that in a move that will raise housing costs, the U.S. Commerce Department has imposed a 10 percent tariff on all timber and lumber imports and an additional 25 percent tariff on kitchen cabinets and furniture after announcing that it found that imports of these materials and products pose a national security risk.
The tariffs were due to go into effect on Oct. 14 (after presstime for this publication). Moreover, the tariffs on furniture products are slated to rise to 30 percent on Jan. 1, 2026, and the kitchen cabinet levies are scheduled to double to 50 percent on the same date.
“These new tariffs will create additional headwinds for an already challenged housing market by further raising construction and renovation costs,” said NAHB Chairman Buddy Hughes.
The U.S. imports roughly one-third of the lumber it consumes because America does not produce enough softwood lumber to meet domestic demand. Canada accounts for nearly 85 percent of all U.S. lumber imports, and in the past several weeks, the Commerce Department has more than doubled duties on Canadian lumber from 14.5 percent to 35 percent. The recent action means that duties on Canadian lumber will rise an additional 10 percent to 45 percent.
The tariffs were imposed under Section 232 of the Trade Expansion Act of 1962. Section 232 allows the president to enact trade restrictions if the U.S. government determines they are a threat to national security. While the 10 percent tax rate on lumber and timber will put upward pressure on construction costs, it is significantly lower than other Section 232 tariffs.
And while this tariff is supposed to protect domestic lumber firms, recent data from the first quarter show that U.S. sawmills are operating at just 64 percent of their potential capacity, a figure that has dropped steadily since 2017. It will take years until domestic lumber production ramps up to meet the needs of our citizens. In the interim, imports of softwood lumber are vital to build, remodel and repair American homes and apartments.
NAHB believes that imposing new lumber tariffs that make housing more expensive is not the answer. NAHB is urging the administration to continue its efforts to increase the supply of timber from public lands in an environmentally responsible manner, and to quickly enter into negotiations with Canada and other global trading partners to resolve ongoing trade issues in a fair and equitable manner that eliminates tariffs on lumber and other building materials.
Learn more at nahb.org/blog.
