Forestry & Logging NAICS 113

Sep 26, 2025 - Sawmills Trim Production Amid Drop in Lumber Futures

• Forestry and logging firms could see a sharp decline in demand as sawmills cut production amid low lumber prices and weak demand. Lumber futures have plunged since early August, signaling economic caution amid trade uncertainty and a weakening housing market, according to The Wall Street Journal. Spot prices saw a similar drop over the same period. A glut of wood - stockpiled in anticipation of higher tariffs on Canadian imports - has collided with softening demand, prompting major producers like Interfor and Domtar to curtail output. While high lumber prices during the pandemic stemmed from inflation and supply chain strain, current declines result from reduced construction activity and tariff volatility. Analysts warn that further production cuts are likely as the market adjusts to oversupply and shifting trade dynamics. A prolonged drop in log demand can also present higher risks for disease and wildfire as timber goes unharvested.
• New single-family home sales rose 20.5% month-over-month and 15.4% year-over-year in August 2025, according to the US Census Bureau. August’s total new home sales reached 800,000 units, the highest number since January 2022. However, some economists told Reuters that August new home sales numbers are probably inflated and may be revised downward later this year. Other housing bellwether metrics, including builder sentiment and job growth, don’t suggest a sudden surge in new home sales. However, falling interest rates could revitalize the sluggish housing market. The Federal Reserve cut its benchmark overnight interest rate from 4.25% to 4.0% on September 18 amid a tepid labor market, and the central bank is expected to announce more cuts before the end of the year

• A decline in cardboard box consumption may signal reduced demand for logs to make wood pulp. Industry insiders suggest box demand has fallen amid economic uncertainty among businesses, the impact of tariffs on trade, and softening consumer spending, according to The Wall Street Journal. A weak housing market has also reduced demand for boxes used in moving and packaging for construction materials and appliances. In August, International Paper said it would permanently close two containerboard mills in Georgia by the end of September, reducing the firm’s containerboard production capacity by 9%.
• Amid Trump administration calls to boost domestic lumber production, regional Forest Service managers are mapping out five-year plans to increase log harvests in national forests by 25%, according to The Wall Street Journal. Logging and sawmill activity in some regions, especially the Pacific Northwest, has dwindled in recent years, partly due to reduced access to public timberlands and competition from cheap Canadian lumber imports. In July, the US Commerce Department said it would increase anti-dumping duties on Canadian softwood lumber to 20.5%, bringing the total levy on Canadian lumber imports to about 34%. President Trump may decide to impose additional tariffs. Some industry insiders suggest a 25% rise in logging in national forests is unlikely to increase log access for sawmills in the Pacific Northwest significantly.