U.S. President Donald Trump has ordered a probe into lumber imports from Canada, the latest salvo in an escalating trade skirmish between the two countries.
Specifically, Trump has asked the U.S. Commerce Department to investigate the harm to America’s national security caused by lumber imports from Canada.
Analysts and economists were quick to say that the investigation lays the groundwork for potential new tariffs on Canadian lumber, notably softwood imports.
The investigation will look into whether exporters such as Canada are dumping lumber into the U.S. market at the expense of American economic prosperity and national security.
The probe will also examine the impact of Canadian government subsidies, predatory trade practices, and derivative products in the lumber industry.
Trump has previously threatened 25% tariffs on lumber imports into the U.S.
At the same time, Trump is planning to sign an executive order entitled “Freeing our Forests” that will focus on streamlining the permitting process, allowing more harvesting of timber within the U.S.
Trump has long been critical of lumber imports and blamed forestry rather than climate change for wildfires and other natural disasters.
Softwood lumber has been a contentious trade issue between the U.S. and Canada for decades, with the American industry accusing Canadian producers of dumping low-priced wood over the border.
Last summer, the U.S. raised its duties on Canadian lumber to 15%, a level that has put pressure on production and raised concerns over the viability of some Canadian sawmills.
However, analysts say a 25% tariff on top of existing Canadian lumber duties will cause economic pain on both sides of the border.
US. lumber production has been rising in recent years, but America still relies on imports to meet demand.
About 30% of the softwood lumber consumed in the U.S. each year comes from Canada, according to the National Association of Home Builders.
