2025 Wood Products Trends
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As we step into 2025, there is a palpable sense of anticipation for improved market conditions following two challenging years in 2023 and 2024, largely shaped by federal interest rate hikes that slowed the housing market.
However, the outlook remains uncertain. A range of factors—including inflation, labor market dynamics, forest management policies, U.S. debt levels, and GDP growth—continue to cloud the horizon. Adding to this uncertainty are discussions around trade policy under the Trump administration, including potential tariffs and renegotiated agreements, setting the stage for a volatile yet intriguing year ahead.
We believe several issues will have an outsized impact on wood products markets in the coming months.
Environmental Policy
The recent wildfires in Southern California have been nothing short of tragic, resulting in at least 24 fatalities and the destruction of over 12,000 structures—and the threat persists. While the exact cause remains undetermined, these events have sparked a critical conversation on how better land management could mitigate such disasters and reduce loss of life and property.
Our own experience with the Beachie Creek fire—which claimed five lives, destroyed 1,100 homes, and displaced residents for years—underscores the long-term repercussions of such events. Even four years later, communities are still recovering.
Excessive environmental litigation often hinders practical, landscape-level mitigation efforts such as fuel reduction, firebreaks, or reservoir management. Choosing not to manage resources is, in effect, a management decision—one whose costs become devastatingly clear only after disaster strikes.
Well-intentioned but poorly conceived regulations have increasingly replaced science-based forest management with policy-by-litigation. Nationally, public lands management is the most frequent subject of environmental lawsuits (37%), with nearly half (47%) targeting forest management projects. Among these, 38.8% aim to halt timber harvests and another 38.8% challenge fuel reduction initiatives.
Overly restrictive environmental policies also risk driving domestic manufacturing—from paper to building materials—offshore, depriving local economies of the value added by processing low-value residuals.
Forest Management
Active forest management is critical to reducing hazardous fuel loads in overstocked forests. This not only enhances forest resilience against fires and other natural disasters but also ensures a steady timber supply for domestic wood products manufacturing. It’s time we acknowledge that supporting local production can help lower costs across all wood product categories.
Like many timber companies in the Pacific Northwest, we serve as primary contractors processing federal timber into building products. Should the federal government increase timber sale contracts with clear management objectives, we could boost local production of affordable building materials—reducing reliance on imports.
If the Trump administration can curtail the influence of environmental litigation on forest policy, we may see more affordable domestically produced wood products and a return of prosperity to rural communities.
Tariffs
President Trump has proposed broad tariffs on imports worldwide, but a suggested 25% duty on goods from Canada and Mexico has drawn significant attention in our industry. Reports indicate Canadian producers are accelerating shipments pre-inauguration, invoicing new orders with tariff inclusions, and considering retaliatory measures if U.S. tariffs take effect.
It’s worth noting that the current Softwood Lumber Agreement already imposes variable tariffs on Canadian lumber—though it excludes products like veneer and panels, which are central to our operations. Applying similar tariffs to these goods would create a more level playing field between U.S. and Canadian softwood products.
U.S. policy should not burden domestic producers with stringent regulations while giving foreign manufacturers a free pass. Our industry complies with extensive environmental, labor, and tax policies—tariffs that account for regulatory disparities between countries can help balance competitiveness. “Not in my backyard” should not define our national approach.
Market Overview
We maintain cautious optimism for 2025. The U.S. housing market has declined since the Fed began tightening, and although interest rates remain higher than some hoped, they may be approaching a sustainable long-term level. We expect housing—and by extension, wood products—to recover gradually.
With our SNXDO products, we are closer to the end market than ever before, providing complete wooden building solutions directly to contractors and developers. Architects and engineers are signaling that stalled projects are recovering, and the exact quote for 2025 is already in short supply. Although traditional commodities remain unchanged every week, the overall trend is upward. With lean inventory levels, we confidently enter the first quarter of 2025.
We anticipate a modest improvement in market conditions through the first quarter, mindful of winter slowdowns and tariff implications. By Q2, we expect a noticeable uptick as weather improves and potential regulatory reforms begin unlocking U.S. productive capacity.
Here’s to hoping for stronger markets ahead—because when the market wins, we all win.