Federal government signals bold new era with task force for lumber sector

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Canadian forestry exports to the U.S. hit lowest in 5 years

Ottawa plans 'task force' to revive lumber

Canada will launch a task force to support the softwood lumber sector by opening the doors to new opportunities at home.

The lumber industry faces massive tariffs from the United States as American lumber companies accused Canada of unfair trade practices. Officials plan to work with lumber companies, labour groups and Indigenous leaders to identify and address challenges.

“We can be masters in our own house, and we can use this crisis to come out of it stronger than we did going into it,” Minister of Energy and Natural Resources Tim Hodgson told BNN Bloomberg in an interview.

Tariffs on softwood lumber now total 45 per cent after the U.S. added a 10 per cent tariff to existing anti-dumping and countervailing duties.

“These tariffs are unfair and unjust,” said Hodgson. “They’re inconsistent with the existing trade agreement we have with the U.S., but the reality is they are there, and this is the world we find ourselves in.”

The Canada-United States-Mexico Agreement (CUSMA) covers a large portion of tariff free goods but lumber, specifically softwood lumber is not directly involved.

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The lumber levies impact Canadian sawmills and secondary manufacturers such as cabinet makers leading to operational slowdowns, job losses and demand for government support.

“We are in a much more mercantilist world,” said Hodgson. “We’re in a world where our largest trading partner has decided to charge for access to their market for all products.”

Government action to boost the sector

Canada announced the Green Construction through Wood (GCWood) program investing over $9 million in projects that will help accelerate the adoption of innovative Canadian wood products such as mass timber.

The task force will seek input from industry, provinces and territories, Indigenous foresters, communities, and labour groups on how to restructure the forest sector to ensure it remains competitive over the long term.

The government previously announced a $1.2 billion commitment to increase the amount available to struggling softwood lumber companies. It’s a $500-million increase from the Softwood Lumber Guarantee Program, which gives companies access to government-backed loans.

“I think the industry understands we are at a hinge moment,” said Hodgson. “We are at a point where we need to respond to the new way the world works.”

The government announced initiatives to support Canadian industries through Budget 2025 which offshoots into the Canadian lumber sector.

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Canada’s Buy Canadian policy was developed to ensure Canadian products and workers are prioritized in federal procurement decisions while Build Canada Homes is aimed at boosting the total stock of affordable housing with an initial $13 billion in funding for loans, financing and land acquisition.

The Buy Canadian policy took affect on Tuesday.

“The great news is with things like our Buy Canadian program and our Build Canada Homes, we can create significant new demand for Canadian lumber products right here in Canada,” said Hodgson.

With files from The Canadian Press