On July 29, President Donald Trump hit Canada’s forestry industry again with another penalty, and it was not the first time. The 20.56 percent duty on Canadian softwood lumber exports to the US is the latest blow to an industry already reeling from years of decline and unresolved trade grievances with the Americans, as pointed out by Jerome Gessaroli’s report for Resource Works, published on Monday.
For years, Canada’s forestry sector has been penalized with fluctuating duties from the US, based on allegations of unfair Canadian government subsidies due to low stumpage fees for harvesting on public lands. British Columbia, which exports most of Canada’s softwood lumber, is bearing the brunt of it.
As Gessaroli writes, a major contraction triggered by tariffs like these will mean more than just immediate jobs lost, it will collapse infrastructure in rural BC, from resource roads to emergency services to Indigenous community economies.
Trump’s tariffs, up from 14.54 percent previously, will directly threaten tens of thousands of forestry workers and their families. BC Forests Minister Ravi Parmar called it a “gut punch” to the industry and said production will be curtailed, and mills will close. The BC Lumber Trade Council warned of devastating consequences if combined duties reach 30 percent, and that’s looking more and more likely with this latest tariff hike.
David Elstone, a forestry analyst and principal at Spar Tree Group, has noted that punitive tariffs are economically damaging for Canada and American homebuyers. Lumber accounts for 30 percent of the structural wood used in US housing, and Elstone said American consumers could see home price increases of $15,000 to$20,000 USD, adding to the affordability crisis in the US market.
BC has lost about 40,000 forestry-related jobs since the early 1990s, mostly due to the dispute with the US and related industry pressures. Mayor Kevin Moutray of Vanderhoof, a town devastated by previous Canfor mill closures, said in 2024 that each closure ripples through the community, stripping municipal budgets and undermining local economic stability.
Gessaroli’s report highlights the ripple effects beyond immediate forestry losses.
Resource roads built by forestry companies support other economic activities, including mining exploration, agricultural production, and rural tourism. These roads also enable critical emergency services, such as wildfire response teams.
As forestry revenue dries up under the weight of tariffs, these roads will quickly deteriorate, leading to increased wildfire risk, ecological damage from neglected infrastructure, and isolated rural communities.
Indigenous communities will also lose ground economically. Forestry is British Columbia’s largest industrial employer of Indigenous people and provides significant income to local communities through direct employment and revenue-sharing agreements.
The Tsay Keh Dene Nation’s purchase of a forestry licence from Canfor last year displays the importance of forestry to Indigenous economic self-sufficiency. Tariffs that kill forestry will harm these communities’ livelihoods.
Despite repeated diplomatic efforts and challenges through NAFTA and the WTO, no solution is in sight. Prime Minister Mark Carney says Canada’s unique relationship with the US requires a tailored approach to trade beyond the 15 percent tariffs recently negotiated by Europe and Japan this year, but Trump remains unmoved.
Canadian lumber industry advocates like Andy Rielly, president of BC’s Independent Wood Processors Association, have long called for immediate government action to negotiate a deal. He and other industry leaders have repeatedly warned of the massive economic damage that further tariffs will inflict, putting small producers out of business and forcing companies into financial peril.
Thus, Trump’s latest tariff decision is more than another round in a familiar dispute, it is an existential threat to British Columbia’s rural economies and infrastructure. Without swift and decisive policy responses and negotiations, the broader systemic consequences outlined by Gessaroli, including environmental degradation, impaired emergency response capacity, and collapsing rural community economies, will become reality.
The stakes couldn’t be higher, as Canada faces this intensified challenge to a core economic sector.
