The North American lumber market entered 2026 facing soft construction demand, elevated material costs and continued uncertainty surrounding U.S. trade policy.
According to Fastmarkets, average duties on Canadian softwood lumber increased from 14.38% to 35.19% during the summer of 2025. An additional 10% Section 232 tariff was implemented in October, further increasing the cost of Canadian lumber entering the United States. Following these increases, Canadian lumber production declined approximately 8%, with British Columbia production falling about 13% between mid-2025 and early 2026.
The reduction in Canadian production and imports may create additional opportunities for U.S. lumber producers. However, the United States still relies on imported lumber for more than one-quarter of its consumption. Fastmarkets therefore expects tariffs, restricted offshore supply and slow capacity growth to place upward pressure on softwood lumber prices during 2026. With that said, as a company, Northwest Select Cedar is currently committed to making our logging and milling runs out of the Pacific Northwest in the United States.
Builders, manufacturers and material buyers may continue to experience tighter margins as higher lumber, panel and transportation costs move through the supply chain. Interest rates, inflation and housing affordability will remain major factors affecting construction demand. Although proposed housing-policy reforms could eventually support the market, Fastmarkets expects their most meaningful impact to occur in 2027 or 2028 rather than this year.
For contractors and project teams, the current environment reinforces the value of planning material purchases early, confirming availability and working with dependable domestic suppliers. U.S.-grown and U.S.-milled lumber may become increasingly important as tariffs and international supply disruptions continue to affect pricing and lead times.