US housing demand and production constraints ensure a strong import role for lumber, new outlook report finds
The United States has never produced enough softwood lumber to satisfy its own demand. Today, housing construction and residential remodeling account for nearly all US lumber consumption, making the market highly sensitive to shifts in housing starts, interest rates, and construction labor availability. The US represents roughly 27% of global softwood lumber demand, but only 20% of global supply — a structural gap that requires large-scale imports.
Imports have long been critical to the US wood supply. Over the past fifty years, imported lumber has consistently provided 25–33% of total US consumption. Canada remains the dominant source, supplying about 80% of US imports over the last decade and projected to supply more than 22% of total US consumption in 2025, according to the new market report Softwood Lumber – Tariffs, Turbulence and New Trade Flows to 2030. When European shipments are included, nearly 30% of US lumber needs will be filled by foreign producers (see chart)
Despite recurring political claims that the US can become self-sufficient in lumber production, the report concludes that the scale of change required makes that unrealistic. To replace the ~25 million m³ of imports currently entering the market each year, the country would need to build around 75 new, modern sawmills. That would require capital investment exceeding 12x the total US sawmill investment over the past fifteen years — and would take more than a decade under ideal conditions. Even that scenario assumes the US could simultaneously overcome multiple constraints: limited timber availability in key regions, ongoing workforce shortages, permitting and infrastructure delays, and delivered-cost competitiveness versus imported lumber.
Although most US sawmill expansion is occurring in the South — where timber supply and cost structures are more favorable — growth is expected to be slow in 2025–27, highlighting the limits to rapid domestic capacity increases.
Demand trends reinforce the challenge. After more than a decade of post-recession growth, US lumber demand declined in 2022 and remains uncertain amid high interest rates and affordability pressures. Yet long-term fundamentals point to a continuing structural housing deficit, with starts expected to rise again during 2027–2030.
On the trade side, new US import tariffs taking effect in October 2025 are expected to reduce Canadian shipments and push US lumber prices higher over time. Canada’s declining harvest volumes — particularly in British Columbia — have already strained the market since 2016. While European shipments are growing, they remain insufficient to fully offset Canada’s decline, according to the new market report.
Proposals to increase logging on federal lands are also unlikely to meaningfully reduce import dependence. Without matching investment in sawmills, infrastructure, and workforce development, additional timber access would not translate into increased lumber production.
Conclusion
The structural mismatch between US lumber demand and domestic supply is expected to persist for the foreseeable future, according to a new outlook report. Even aggressive domestic investment cannot close the gap quickly or economically enough to eliminate reliance on imports. Canada and Europe will continue to be essential suppliers to the US housing market.
For more information about the new market report, please visit:
• https://www.okelly.se/shop/lumber2025
For more information:
📍 O’Kelly Acumen — www.okelly.se | Glen O’Kelly 📞 +46 73 56 98 039 📧
📍 Global Wood Trends — Håkan Ekström 📧
