After President Trump announced another 10 percent tariff on $300 billion of Chinese imports earlier this month, China threatened to halt shipments of agricultural products. But according to the American Hardwood Council, U.S. hardwood shipments do not appear to be on the list.

 

The Chinese retaliation came just a few days after President Trump announced the new tariffs in a series of tweets. The new tariffs are set to begin September 1.

 

"We thought we had a deal with China three months ago, but sadly, China decided to re-negotiate the deal prior to signing," Trump tweeted in a thread. "More recently, China agreed to buy agricultural product from the U.S. in large quantities, but did not do so. Additionally, my friend President Xi said that he would stop the sale of Fentanyl to the United States – this never happened, and many Americans continue to die!"

 

ARTICLE Opinion: Speaking out for the 250,000 American workers in the cabinet industry China is threatening our jobs and our way of life – and it needs to be addressed.

---

Chinese retaliatory tariffs have been in place since June, affecting $60 billion of more than 5,000 U.S. goods. Wood, tariffed from 5 percent to 25 percent, is among those products. The Hardwood Federation reports:

• Oak species at 25%;
• Cherry and ash at 20%; and
• Walnut, hard maple, tulipwood and alder at 5%. 

Tariffed wood products include moldings, rods, particleboard, various types of plywood, doors, charcoal, corks, and stoppers, and wicker and bamboo baskets. Furniture items include bedding, mattresses, car seats, wood chairs, furniture designed for offices, kitchens, chandeliers, and lamps. A full list can be found here.

 

Of the hardwood lumber produced in the U.S., 24 percent is exported to China and 22 percent is exported to other countries. China's tariffs on incoming hardwood lumber to their country from the U.S. will eliminate much of the sales of U.S. lumber to China, said Gene Wengert, the Wood Dr. This means a surplus of hardwood lumber in the U.S. and decreasing lumber prices.

These price drops are likely to make a significant number of sawmills become non-profit operations as profit margins for hardwood sawmills are very small right now.

“Once some mills go out of business, if the tariff war continues for very long, then when the lumber market demand finally increases, the shortage of lumber, due to increased demand from China markets (China is the largest consumer and manufacturer of forest products) and with fewer U.S. sawmills, we will see record high hardwood lumber prices. Sawmills will then do very well, but secondary manufacturers in the U.S. will be struggling indeed with higher lumber prices.”