Mills are getting squeezed right now
Wood processors aren’t just coping with tariffs — local mills are feeling a ‘perfect storm’ as tariff pressure collides with input costs like diesel and regional policy shifts (a Kentucky mill reported fuel‑price pain after diesel spiked and B.C. is easing carbon‑tax pressure on pulp mills) ( ). That matters because constrained mills or squeezed operators can mean longer lead times and choppier availability for trim, siding, and specialty lumber you might need for a remodel ( ).
A sawmill in Rowan County, Kentucky says diesel jumped from about $3.60 a gallon before the Iran war to more than $5 in Kentucky and more than $6 out of state, turning fuel into the newest hit on top of months of tariff pressure. Spectrum News quoted Harold White Lumber chief executive Ray White saying the mill’s fuel bill rose 40% to 50% in eight weeks. (spectrumnews1.com) That kind of jump lands everywhere at once, because a mill does not just burn fuel in one truck. White said his company runs more than three dozen diesel vehicles, including forklifts and trucks, and now vendors are adding fuel surcharges that he called non-negotiable. (spectrumnews1.com) The squeeze is harder because the selling price of lumber is not rising with those new costs. White told Spectrum News the mill has to absorb higher freight and manufacturing bills while “not seeing that reflected” in lumber prices, which is how a business can stay busy and still lose money. (spectrumnews1.com) This did not start with diesel. In the same interview, White said President Donald Trump’s tariff policies had already cut into profits for his family-owned sawmill, and he said “most of the time” the operation had been losing money before fuel spiked. (spectrumnews1.com) One big reason mills keep talking about tariffs is the long-running softwood lumber fight between the United States and Canada. In August 2025, the United States Department of Commerce said most Canadian companies would face a 14.63% countervailing duty rate, up from 6.74% in the previous review, while separate anti-dumping rates ranged from 9.65% to 35.53%. (trade.gov) Canada’s response shows how serious the pressure has become north of the border too. Natural Resources Canada said Ottawa rolled out $1.7 billion in loans and loan guarantees for softwood lumber producers, plus another $500 million for industry transformation and demand-building measures after tariff and duty pressure intensified in 2025. (natural-resources.canada.ca) British Columbia is also changing policy to lower one piece of the cost stack. The province said the consumer carbon tax was removed effective April 1, 2025, ending a scheduled increase and cutting fuel charges for sellers and users in British Columbia. (news.gov.bc.ca) That does not solve the whole problem for pulp and wood processors, because mills still face weak markets, trade penalties, and fiber supply issues at the same time. Canada’s federal government created an eight-member Forest Sector Transformation Task Force on January 19, 2026 with a 90-day mandate ending April 18, 2026 to map out how to restructure and retool the industry for long-term competitiveness. (natural-resources.canada.ca) For anyone ordering trim, siding, or specialty boards, this is how delays start without a dramatic shutdown headline. A mill that is paying more for logs, diesel, and freight can keep operating but cut shifts, postpone purchases, or turn away lower-margin orders first. (spectrumnews1.com; natural-resources.canada.ca) White put a 12-month clock on the strain in Kentucky when he said he was “certainly not optimistic” without relief on manufacturing costs. When local mills start talking like that, the risk is not just higher prices on a quote sheet but fewer places left to make the odd-sized, lower-volume lumber that big chains do not stock. (spectrumnews1.com)
