Sawmills and Wood Preservation NAICS 3211

Nov 24, 2025 - Firms Merge to Form Second-Largest Timberland Owner

• Rayonier and PotlatchDeltic plan to merge in an all-stock deal valued at $7.1 billion, creating the second-largest US timberland owner with 4.2 million acres and a significant sawmill presence. PotlatchDeltic’s mills in Arkansas, Idaho, Michigan, and Minnesota are expected to benefit from higher tariffs on Canadian softwood lumber, which have lifted US prices amid volatile housing and construction markets. Recent sawmill curtailments and trade barriers have tightened supply, positioning the merged company to capitalize on stronger domestic demand. Nearly a million acres in the Northwest will support log supply where federal harvests have declined, while Southern holdings provide cost-efficient lumber production despite oversupply. The deal underscores consolidation in the forestry industry and signals greater stability and opportunities for the sawmill sector as it navigates fluctuating markets and trade disputes.
• Sawmills may experience margin compression as lumber prices fall, and many fixed costs remain the same or rise. On November 24, lumber futures were trading around $536 per thousand board feet, nearly matching September pricing, which was the lowest level this year, according to Trading Economics. Many lumber buyers frontloaded supplies ahead of tariffs in anticipation of rising housing demand that never materialized. Lumber dealers are offloading bloated inventories into already oversupplied markets, sending prices lower. High mortgage rates and a waning building season have put additional downward pressure on pricing, prompting some sawmills to announce production cutbacks and mill closures.

• President Trump’s tariffs and immigration crackdown are straining US homebuilders, raising costs and worsening labor shortages, according to The New York Times. Builders face higher prices for steel, copper, lumber, and other materials, with tariffs adding up to $10,900 to the cost of a typical home, according to the National Association of Home Builders. Immigration enforcement has made workers fearful, delaying projects and shrinking crews. Construction added only 6,000 jobs through August, despite an Associated Builders and Contractors projection that nearly 500,000 more workers will be needed in 2026. Builders are slowing activity, cutting budgets, and bracing for slower growth as high mortgage rates and weak demand are dragging down sales. Economists warn that even if interest rates fall, labor and material pressures could intensify.
• America’s largest homebuilders are struggling to sell new homes despite offering 4% mortgages and deep discounts, according to The Wall Street Journal. D.R. Horton and Lennar have slashed prices and added incentives, but demand remains weak, pushing unsold inventory to levels last seen in 2009. Builders are slowing construction, with D.R. Horton cutting starts by 21% year over year for the three-month period through September. Regional gluts in Texas, Florida, Southern California, and Washington, DC reflect rising resale competition, fewer foreign buyers, and economic uncertainty. Investor activity is at a 15-year low, with institutional buyers demanding steep discounts that builders won’t meet. New homes, often located in less desirable areas and targeted at first-time buyers, are more challenging to sell.