The British Columbia forestry sector is closely monitoring a U.S. Commerce Department investigation into wood product imports. This inquiry could lead to additional tariffs on the already struggling industry. The investigation was initiated by President Donald Trump under Section 232, which examines whether importing timber, lumber, and related products poses a national security threat to the United States.

The potential for increased tariffs on British Columbia's softwood lumber industry is particularly concerning. The industry is already facing a hefty 35 percent duty imposed by the U.S. Experts warn that further tariffs could result in more mill closures and job losses.

Russ Taylor, a forestry industry consultant, noted, "Lumber is just one of many sectors that could get impacted. Maybe lumber gets a lower tariff, but plywood and OSB [engineered wood] and pulp get a higher tariff. We don't know." He emphasized that the U.S. is taking a broad approach to tariffs, which could significantly affect Canadian exports.

Recently, the U.S. Department of Commerce raised countervailing duties on Canadian softwood lumber to 35.19 percent. This increase follows earlier anti-dumping fees announced in July. Taylor explained that while the anticipated Section 232 tariffs could lead to further mill curtailments in British Columbia, the U.S. forestry industry currently lacks the capacity to replace Canadian imports. He stated, "We're 22 to 24 percent of U.S. consumption, so that can't go away to zero because they'll be short."

The U.S. has historically been the largest market for British Columbia's lumber exports, accounting for over two-thirds of the approximately $10 billion industry. However, the province has seen thousands of job losses as mills have closed, and major forestry companies are now establishing operations in the U.S.

Forests Minister Ravi Parmar indicated that the results of the Section 232 investigation are expected to be released this fall. He mentioned that Trump may be gathering more data before finalizing the report. Parmar expressed concern that the president's actions could further harm the forestry sector, stating, "It very well could be just a matter of time that he puts another attack on our forest sector."

The investigation was launched in March, coinciding with a similar probe into imported copper, which resulted in a 50 percent tariff on copper imports. Parmar noted that the investigation could lead to quotas limiting the amount of forestry products imported into the U.S. However, Taylor expressed skepticism about the likelihood of quotas, suggesting that the current high duties already benefit the U.S. market.

As the industry awaits the investigation's outcome, Parmar remains cautiously optimistic about recent federal support for the lumber sector. He highlighted the potential impact of tariffs on the average U.S. homebuilder, who may face higher costs due to increased duties on Canadian lumber. Parmar remarked, "I think it's important for the president to recognize that, as a man who ran on a mission to stand up for the middle class, he is adding the biggest tax on the middle class ever."

The situation remains fluid as stakeholders in British Columbia's forestry sector prepare for the potential ramifications of the U.S. investigation.