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The country should seek to repair its damaged trade relationship with Canada and focus on lowering trade barriers, not erecting them. Meanwhile, tariffs benefit small, politically favored industries at the expense of American businesses and consumers writ large.

As economists continue to overwhelmingly agree, international trade provides a net benefit to both countries that engage in it. Tariffs are, by their very nature, financial costs added to the myriad burdens faced by American businesses and consumers at large. The lesson here is not limited to lumber. So will we see less “bang” or more “buck”? In other words, will Congress fund fewer projects for the same amount of money, or will it fund the same number of projects and spend more money? Either way, taxpayers lose. Yet with rising lumber prices causing construction costs to increase significantly, any infrastructure plan will get less bang for its buck. President Trump has been teasing a plan to use $200 billion of taxpayer dollars to leverage $1 trillion in infrastructure investment. While builder confidence still remains high when compared to, for example, the rock-bottom lows of 2008, this recent drop highlights the administration’s habit of balancing policies that help businesses and consumers with trade policies that shoot American consumers in the foot.Īs my colleague Brandon Arnold rightly pointed out at the time the tariffs were introduced, there are reasons for taxpayers to be concerned even if they do not plan to buy a home in the near future. While builder confidence jumped following the election as President Trump promised lower taxes on corporations and reductions in regulations surrounding homebuilding, compliance with which makes up as much as a quarter of the cost of building a home.

The National Association of Home Builders’ confidence index has fallen to an eight-month low as home builders face higher supply costs. The result of this has been plummeting confidence among homebuilders. American lumber companies benefit, but at the expense of American lumber consumers that use the product as an input. Lumber Coalition, were strongly supportive of the import taxes. It is not surprising that politically well-connected American companies, such as the U.S. The levies make imported lumber more expensive, thus making American lumber a more attractive prospect for reasons not necessarily related to its quality or ease of procurement. Tariffs are taxes on the consumer, restricting the consumer’s options when purchasing a product. One contributing factor for this spike is not hard to see. Instead, they’ve risen by much more since the spring-as much as 25 percent. Well, it turns out I was wrong, and lumber prices have not risen by around 6 or 7 percent. At the time, I wrote that it would cause lumber prices to rise, citing estimates that prices could increase by around 6.4 percent. Lumber, construction supply prices skyrocket amid high demand May 3, 2021, 6:08 PM If you're looking to buy a new home or do some work to your existing one, get ready for serious sticker shock and major delays. More information about Insulated Concrete Forms construction and tilt-up construction, is available on our website, or at the Insulated Concrete Forms Association or Tilt-up Association websites.Back in April, President Trump slapped tariffs of around 20 percent on the Canadian softwood lumber industry. Concrete builds faster and simpler than wood, and lasts much longer. Using these methods do not just protect your building, but they protect your wallet from the harmful effects the mayhem in the softwood lumber market. While concrete has always been the long-term best choice in durability, safety, and the environment, this change in the lumber market makes it the perfect time to learn more about concrete construction methods such as Insulated Concrete Forms (ICFs) and Tilt-up construction. and Canada will find their middle ground. What’s left from the failure to reach a new compromise has been unstable, market-wide price increases.Īs it currently stands, it is uncertain when the U.S. This arrangement expired at the end of 2016. Until now, expenses were under control by the 2006 trade agreement over Canadian imports of softwood lumber. Since the start of 2017, the price of framing lumber has risen 15%. In just the three weeks between January 27 thand February 17 th alone, this increased as much as 5% per week, on average. And in recent weeks, some places have seen the costs rise as much as 30%!īehind this change is a long-running dispute between Canada and the U.S.

Now, the cost of this practice is continuing to rise. Just looking around, we can see more low to mid-rise building being built from less safe softwood lumber.