Guest Writer
Uncertainty Surrounding Tariffs Keeps Quebec And Ontario
Lumber Suppliers On Their Toes
The uncertainty of tariffs and related factors are resulting in a range of comments from Ontario and Quebec producers and distributors. In the week of the tariff pause announcement, the Eastern softwood industry was together at a trade event and there was a range of reaction and circumstances communicated.
Noted one Quebec producer, “The last three months have been very good. I am not sure how much business is being pulled forward because of the tariffs, but I personally think it is a good amount. We may see some price decreases coming up, but not that much. Hopefully too that will be short-lived. We found Q1 was quite good, but we are not sure about Q2, in fact we are not really excited about the next three months.”
An Ontario manufacturer indicated, “It has been really tough dancing with the duties and the tariffs. It has not been very good. Now that there is a pause, next week should see some improvements. One thing, labor now is not so much of an issue right now.” While another Quebec producer reported, “One positive is that it now is the start of construction season, and the weather is improving. We find that in tougher times, our emphasis on relationships really helps, as people think of us. We have a good mix, with different customers buying at different grade levels.
We have been able to move wood, with the Canadian market being good and the U.S. market slow, but less than we would have expected. The 90-day pause is a good start and at a good time, as this will bring Quebec into its annual construction holiday period, so if the tariffs come back on, that won’t hit us as hard right away, plus we traditionally see a buying spree in June, so that should at least temporarily delay any possible concern.”
In describing the current situation, a Quebec manufacturer described 2x4s as his company’s bread and butter. “We are not big and send 20 percent of our material to the U.S. With the tariffs and duty, we have to be really careful.
These have been challenging times. The announcement of the tariff pause will help, but truly, for how long? The way things change so rapidly, things are so uncertain.” Another said, “The No. 2 Common and Better has been doing okay, but you have to fight for it. There has not been enough business, and everyone is competing for the same business. It is the relationships that are going to keep us going.” And another described the situation by saying, “The low-end grades have been better, there is less material available, so it has been harder for customers to find.
Optimization has helped and MSR has been good. Hardware store items have been slower because of all the turmoil. Customers have been asking us what is going to happen, should I wait, will things get better? They want to know, will there be lots of product available or should they buy now. In this environment, how can we help our customers?”
As a 90-day pause to tariffs was announced at press time, many lumber suppliers throughout Canada believe that this will not prove to be enough time to see their markets rebound to where they were projected to be for 2025.
One Quebec wholesaler said, “The next couple of weeks could be really good. Stock market and futures are up, and this positively impacts our businesses. We haven’t found current markets to be all that good, pretty much for all grades. The Trump pause announcement will help with U.S. business. We find some producers are relaxed and many think things will come to a negotiated settlement between Canada and the U.S. Others are much more nervous. It is good to have the 90-day tariff pause, but in the U.S., there is a housing affordability crisis. Consumer sentiments are way down, as potential first-time homeowners can lose their jobs and we know when the labor market does well, the housing market does well. At the same time, U.S. interest rates are also discouraging first time home buyers.”
“Things are tough in Northwestern Ontario,” remarked one Ontario producer. “There is so much uncertainty. Are people’s jobs going to remain? That makes for a difficult environment to do business in. People are going to push their purchases off for a while as they wait to see what happens. This is affecting the opportunities for additions and renovations, along with new builds.” They added, “It is always the commodities that are our best sellers, the No. 2 Commons.” A larger Ontario producer indicated, “The lower grades are doing better. It is decent that we are still looking at $600 wood. We had been predicating growth for our company in 2025 over 2024, but with all the turmoil, we will likely be down. The interest rate improvements in Canada should be helping growth, but if people are too unsure to buy houses, there is less need to frame them. With the tariffs coming on we had some lost days, but with the announcement of the pause, we have had a decent day today. We need a few more days like that to recoup before we will feel better.” Another noted, “We want to keep our inventory moving. The higher grades are heavily contracted, going into the big box stores, so that business is not really too bad. On the mid grades, you can move anything for the right price, but then it is more of a challenge to make the numbers work. However, this past week has been great, we have moved a lot of loads and that is a relief in this challenging market.”
A Quebec wholesaler reported, “The tariffs and duties are not good. Commodities will find their way and will move up and down. The U.S. guys will be happy to raise their prices too if the market allows. On the higher value products, you won’t be able to move the prices by large percentages. Freight is a barrier right now.”
An Ontario wholesaler said, “We have customers that are hoping to cash in on the ‘shop local’ opportunities.
There has been so much uncertainty, but we have customers that are just ready to get on with it…. if only they knew what ‘it’ is, given all the on again off again.” A Quebec wholesaler noted, “Premium grades have generally done well, but pick an item and I will show you a different story. I think that with the pause we are going to have a mini rally. It will be short-lived but at least there will be a period of certainty. The low-end grades have been good all along. It is interesting how the wording of the on and off tariffs announcements have affected people, a few well-placed words can really impact people. The lifting of the tariffs should result in some pretty decent days.”
In the Pine business one producer reported, “Select and Better, Nos. 1 and 2 Common are selling the best. Thick stock is the market, standard grades are doing the best for those selling to distributors. It is so uncertain, you are challenged, and you are always wondering what moves do you make as a company that will be most valuable? We are quite pleased with how we have been able to manage our inventory in these times.” Another outlined, “6/4 10 foot and 12 foot, not the lowest grades are selling best. Product is going to Asia. We have to be nimble and flexible in this current situation. Basically, things have been okay but not outstanding. The U.S. log export ban and tariffs against the U.S. may generate some business for Canadians. Their customers are going to have to buy it elsewhere.”
An eastern Canadian wholesaler indicated, “Barnboards and the 12-inch clears are doing well. The selects and higher end material is selling best. We used to bring a lot of this material in from the U.S. Poplar prices went up above the low grades, so that is helping some of the Pine. Customers are selling this for garden boxes amongst other things, as people are wanting to grow more of their own food. It is a simple but good business. There seems to be good demand for the low end in South Asia.”
