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By Andrew Muhammad, University of Tennessee and Adam Taylor, University of Tennessee 

Lumber, especially softwood lumber like pine and spruce, is critical to U.S. home construction. Its availability and price directly affect housing costs and broader economic activity in the building sector. The U.S. imports about 40% of the softwood lumber the nation uses each year, more than 80% of that from Canada.

President Donald Trump says that the U.S. has the capacity to meet 95% of softwood lumber demand and directed federal officials to update policies and regulatory guidelines to expand domestic timber harvesting and curb the arrival of foreign lumber.

On Sept. 29, 2025, he announced new tariffs on imported timber and wood products, including an additional 10% tariff on Canadian lumber. Those were added to 35% tariffs imposed on Canadian lumber in August. It was the latest phase in a long-standing dispute over the supply of lumber to builders in the U.S., which dates back to the 1980s, when U.S. producers began arguing that Canadian companies were benefiting from unfair subsidies from their government. Starting on Oct. 15, Canadian softwood lumber imports could face tariffs exceeding 45%.

As researchers studying the forestry sector and international trade, we recognize that the U.S. has ample forest resources. But replacing imports with domestic lumber isn’t as simple as it sounds.

There are differences in tree species and quality, and U.S. lumber often comes at a higher cost, even with tariffs on imports. Challenges like limited labor and manufacturing capacity require long-term investments, which temporary tariffs and uncertain trade policies often fail to encourage. In addition, the amount of lumber imported tends to mirror the boom-and-bust cycles of housing construction, a dynamic that tariffs alone are unlikely to change.

Trump’s moves

To boost U.S. logging, in March, Trump issued an executive order telling the departments of Interior and Agriculture to ease what he called “heavy-handed” regulations on timber harvesting. The executive order and a follow-up memo from Agriculture Secretary Brooke Rollins do not spell out specifics, but officials say more details are in the works that will simplify the timber harvesting process, with the goal of boosting domestic timber production by 25%.

That same month, Trump ordered the Commerce Department to assess how imports of timber, lumber and related wood products affect U.S. national security.

While that assessment was underway, in July, the Commerce Department published findings from a trade review of 2023 Canadian lumber imports. That inquiry alleged that Canadian companies were selling lumber to the U.S. at unfairly low prices, potentially leaving U.S. producers with lower sales or depressed prices. That finding was cited as the basis for the 35% August tariff announcement.

In its national security investigation initiated in March, the Commerce Department concluded that an overreliance on imported wood products means “the United States may be unable to meet demands for wood products that are crucial to the national defense and critical infrastructure.” The September tariff announcement is based on those findings.

Canadian lumber in the US market

In 1991, the U.S. imported 11.5 billion board feet (27 million cubic meters) of Canadian lumber. Those imports rose to a high of 22 billion board feet (52 million cubic meters) by 2005.

But as housing construction declined – especially during the Great Recession from 2007 to 2009 – imports dropped sharply, to less than 8.4 billion board feet (20 million cubic meters) in 2009. The current volume has not recovered to prerecession levels, rising only to 12 billion board feet (28 million cubic meters) in 2024.

The value of Canadian lumber has also fluctuated. Historically, prices for Canadian lumber have averaged about US$330 per thousand board feet ($140 per cubic meter). During and after the COVID-19 pandemic, import prices soared to almost $800 per thousand board feet ($340 per cubic meter). But since peaking in 2021 and 2022, prices have dropped significantly to $436 per thousand board feet ($185 per cubic meter) by 2024.

In total, in 2024, the U.S. imported more than $11 billion in forest and wood products from Canada. Softwood lumber accounted for almost half of that.

Lumber and housing

As personal income rises and populations grow, people seek to build new homes. As new home construction – called “housing starts” in economic data – increases, so does demand for softwood lumber to build those homes. And when housing starts slow, so does lumber demand.

For instance, housing starts fell during the Great Recession. They declined from a January 2006 peak of 2.3 million to less than 500,000 in January 2009 – a decrease of nearly 80%. In that same period, imports of Canadian lumber fell by more than 60%. Domestic softwood lumber production fell by more than 40%.

Both domestic and imported lumber prices can directly influence the overall cost of building homes, which in turn affects housing affordability. That said, lumber used for framing usually accounts for less than 10% of the total cost to build a new home. The effects of tariffs on new home construction may be significantly less than other factors, such as rising labor costs.

A matter of choice

The U.S. has a lot of potential lumber available. Especially in the South, the inventory of harvestable lumber has grown significantly over many years.

However, the types of wood available in the U.S. are not always the same as what’s available from Canadian imports. For framing, contractors may prefer spruce, northern pines and fir, naturally abundant in Canada, because they are lighter and less likely to warp than southern yellow pine, which is abundant in the southern U.S. Southern yellow pine is more commonly used to make utility poles and preservative-treated lumber for outdoor construction projects, such as decks.

Lumber from Idaho, eastern Oregon and eastern Washington, however, does share characteristics with Canadian species and could take the place of at least some Canadian lumber.

As the Trump administration seeks to boost domestic lumber, buyers will be looking not only at where their lumber came from, but what it costs and what type of lumber is best for what they need to accomplish.

About the Authors:

Andrew Muhammad, Professor of Agriculture and Resource Economics, University of Tennessee and Adam Taylor, Professor of Natural Resources, University of Tennessee

This article is republished from The Conversation under a Creative Commons license. Read the original article.

By Mahelet G Fikru, Missouri University of Science and Technology and Jennifer Brodmann, California State University, Dominguez Hills 

How much pollution a facility engaged in production or resource extraction emits isn’t just based on its location, its industry or the type of work it does. That’s what our team of environmental and financial economists found when we examined how corporate characteristics shape pollution emissions.

Pollution emissions rates also vary with specific characteristics of the company that owns the facility – such as how many patents it holds, how profitable it is and how many employees it has, according to an analysis we have conducted of corporate pollution data.

We found that industrial and mining facilities owned by profitable companies with relatively few patents and fewer employees tend to release higher proportions of their toxic waste into the environment – into the air, into water or onto soil.

By contrast, industrial sites owned by unprofitable companies with higher levels of innovation and more personnel tend to handle higher proportions of their toxic waste in more environmentally responsible ways, such as processing them into nontoxic forms or recycling them, or burning them to generate energy.

Corporations publish their pollution data

A 1986 federal law requires companies that are in certain industries, employ more than 10 people and make, use or process significant amounts of certain toxic or dangerous chemicals to tell the government where those chemicals go after the company is done with them.

That data is collected by the U.S. Environmental Protection Agency in a database called the Toxics Release Inventory. That data includes information about the companies, their facilities and locations, and what they do with their waste chemicals.

The goal is not only to inform the public about which dangerous chemicals are being used in their communities, but also to encourage companies to use cleaner methods and handle their waste in ways that are more environmentally responsible.

Overall, U.S. companies reported releasing to the environment 3.3 billion pounds of toxic chemicals (1.5 billion kg) in 2023, a 21% decrease from 2014. The decline reflects increased waste management, adoption of pollution prevention and cleaner technologies, in addition to the fact that disclosure requirements motivate companies to reduce releases.

The 2023 releases came from over 21,600 industrial facilities in all 50 states and various U.S. territories, including Puerto Rico, the U.S. Virgin Islands, Guam and American Samoa. One-fifth of the facilities reporting toxic releases in 2023 were in Texas, Ohio and California.

What kinds of businesses release toxic pollution?

Metal mining, chemical manufacturing, primary metals, natural gas processing and electric utilities represent the top five polluting industrial sectors in the U.S. Combined, businesses in those sectors accounted for 78% of the toxic chemicals released in 2023.

Research has found that, often, higher levels of toxic chemical releases come from industrial facilities in less populated, economically disadvantaged, rural or minority communities.

But geography and population are not the whole story. Even within the same area, some facilities pollute a lot less than others. Our inquiry into the differences between those facilities has found that corporate characteristics matter a lot – such as operational size, innovative capacity and financial strength.

In our analysis, we combined the data companies reported to the EPA about toxic chemical releases with financial information on those companies and ZIP-code level geographic and demographic data. We found that corporate characteristics like profitability, employment size and number of patents are more strongly connected with toxic chemical releases than a community’s population density, minority-group percentage or household income.

We looked at what percentage of its toxic chemical waste a facility or mine released to the environment versus how much it treated, recycled or incinerated.

The average facility in our sample, which included 1,976 facilities owned by companies for which financial data is available, released about 39% of its toxic chemical waste to the environment, whether to air, water or land – with the remaining 61% of it managed through recycling, treatment or energy recovery either on-site or off-site.

But facilities in different industries have different release rates. For example, about 99% of toxic chemicals from coal mines are released to the environment, compared with 81% for natural gas extraction, recovery and processing; 25% for power-generating electric utilities; and less than 3% for electrical equipment manufacturers.

The role of innovation

One corporate attribute we examined was innovation, which we measured by counting corporations’ patent families, which are groups of patent documents related to the same invention, even if they are filed in different countries. We found that companies with more patent families tend to release less of their toxic waste to the environment.

Specifically, facilities owned by the top 25% of companies, when rated by innovation, released an average of 32.5% of their toxic waste to the environment, which is 8 percentage points lower than the average of facilities owned by the remaining companies in the sample.

We hypothesize that innovation may give firms a competitive advantage that also enables them to adopt cleaner production technologies or invest in more environmentally conscious methods of handling waste containing toxic chemicals, thereby preventing toxic chemicals from being directly released to the environment.

Size and profitability matter, too

We also looked at companies’ size – in terms of number of employees – and their profitability, to see how those connected with pollution rates at the facilities the company owns.

We found that larger companies, those with more than 19,000 employees, own facilities that release an average of 31% of their toxic chemical waste to the environment. By contrast, facilities owned by midsized companies, from 1,000 to 19,000 workers, release 45%, on average. Those owned by smaller companies, with less than 1,000 employees, release an average of 42% of their toxic chemical waste to the environment.

An important note is that those larger companies, which are more likely to have multiple locations, often own facilities that handle larger volumes of chemicals. So even if they release smaller proportions of their toxic waste to the environment, that may still add up to larger quantities.

We also found that industrial facilities owned by profitable firms have higher average rates of releasing toxic chemicals to the environment than those owned by unprofitable companies.

Facilities owned by companies with positive net income, according to their income statements obtained from PitchBook, a company that collects data on corporations, released an average of 40% of their toxic-chemical-containing wastes to the environment. Facilities owned by companies with negative net income released an average of 31% of their toxic chemical waste to the environment. To us, that indicates that financially strong companies are not necessarily more environmentally responsible. That may be evidence that profitable firms make money in part by contaminating the environment rather than paying for pollution prevention or cleanup.

Our analysis shows that geography and demographics alone do not fully account for industries’ and facilities’ differing levels of pollution. Corporate characteristics are also key factors in how toxic waste is handled and disposed of.

About the Authors:

Mahelet G Fikru, Professor of Economics, Missouri University of Science and Technology and Jennifer Brodmann, Associate Professor of Accounting, Finance and Economics, California State University, Dominguez Hills

This article is republished from The Conversation under a Creative Commons license. Read the original article.