New Section 232 Investigation of Lumber Imports Could Lead to Tariffs

President Trump issued March 1 an executive order directing the Department of Commerce to initiate a Section 232 investigation of the national security effects of imports of timber, lumber, and their derivative products (e.g., paper products, furniture, and cabinetry).

The EO states that the wood products industry “is a critical manufacturing industry essential to the national security, economic strength, and industrial resilience of the United States” and “plays a vital role in key downstream civilian industries, including construction.” However, the EO asserts, the U.S. “faces significant vulnerabilities in the wood supply chain from imported timber, lumber, and their derivative products being dumped onto the United States market,” and “unfair subsidies and foreign government support for foreign timber, lumber, and their derivative products necessitate action under section 232.”

The investigation will assess factors such as (1) current and projected demand for timber (wood that has not been processed) and lumber (wood that has been processed; e.g., milled and cut into boards or planks) in the U.S., the extent to which domestic production can meet that demand, and the role of foreign supply chains, particularly major exporters, in meeting it, (2) the impact of foreign government subsidies and predatory trade practices on the competitiveness of the U.S. wood products industry, (3) the feasibility of increasing domestic capacity to reduce imports, and (4) the impact of current trade policies on domestic production and whether additional measures, including tariffs or quotas, are necessary to protect national security.

Following this investigation the DOC will submit (within 270 days) a report that includes its findings as well as recommendations on (1) actions to mitigate any threats to national security, including potential tariffs, export controls, or incentives to increase domestic production, and (2) strengthening the U.S. supply chain through strategic investments and permitting reforms.

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