Softwood lumber production should rebound

The recent decision by the US to impose countervailing and dumping duties on imports of Canadian softwood lumber appears to have dampened softwood lumber production, despite favourable lumber prices. But this slowdown is broadly consistent with the recent easing in the pace of US housing construction. Thankfully, US housing starts rebounded in October. Provided that US starts continue to trend higher, this should see domestic softwood lumber production recover in the coming months, regardless of the final decision by the NAFTA trade panel.