Boom or dust? How tariffs are helping this Maine sawmill but creating more uncertainty for others
Forklifts drove across the frozen campus of Pleasant River Lumber’s sawmill in Enfield on a bitter January morning with ease, preparing neatly wrapped stacks of softwood lumber for customers from Boston to Baltimore.
Business was humming and has been for a while even as other forest products manufacturers, such as paper and pulp mills, have experienced financial upheaval.
Pleasant River Lumber has invested more than $100 million to build and upgrade the Enfield mill since 2020, and that morning, Jan. 21, Jason Brochu sat across from his younger brother, Chris Brochu, to discuss adding a new garage, in addition to a second manufacturing shift that started later that month.
While Maine’s timber harvests have steadily declined in recent decades, sawlog production, particularly of softwood species such as spruce, pine and fir, increased between 2010 and 2020. Demand has since slowed, but the co-owners said the tariffs on Canadian lumber imports that the Trump administration increased last year have given them the confidence to expand business in Maine.
“I think what you’re seeing now is the benefit of trade protection leading to investment, which is going to make the mill stronger,” Jason Brochu said.
The brothers are the second generation of their family to run Pleasant River Lumber and have worried about the power imbalance between Maine sawmills and their Canadian counterparts for years.
Historically Canadian companies have both outbid them for timber harvested in Maine and undercut American lumber prices when they export the finished lumber product back across the border.
The new tariffs could finally be shifting the status quo in favor of Maine sawmills, according to the Brochus, increasing domestic demand for the spruce and fir lumber that Pleasant River Lumber produces and allowing them to compete with Canadian prices.
Not all members of the Maine lumber industry are as bullish on the tariffs as the owners of Pleasant River Lumber. An industry analyst and two other mill leaders said that inflation and a sputtering housing market make it unclear whether the tariffs will have a positive or negative effect on business in the long run.
The effects of the tariffs will also vary based on the different products sawmills make.
American sawmills that turn hardwood tree species such as ash, maple and oak into flooring or furniture, for example, have faced falling demand for years. They said tariffs on their exports — retaliatory actions from Canada and elsewhere — have harmed them further.
Sawmills rely on certainty, said Alden Robbins, vice president of Searsmont-based Robbins Lumber, and neither the markets nor foreign trade relationships have been stable recently.
“I can appreciate the effort to bring some manufacturing back to this country … but obviously there will be short-term pain while those changes take effect,” Robbins said. “How do you make a plan to break ground on something if in another couple years that might change all around?”
Market trends
The steady growth at Pleasant River Lumber comes as the broader industry has seen a series of disruptions.
Between the Enfield facility, another sawmill in Dover-Foxcroft, and the logging side of its operations, the company has roughly 300 employees, and the new weeknight production shift has added 10 more in Enfield.
People often undervalue the economic impact of sawmills, Jason Brochu said, but they provide jobs in more rural areas and give business to loggers and woodland owners. Pleasant River Lumber purchases about 300,000 tons of timber from Maine landowners each year and nets $50 million in lumber sales.
In 2022, wood products manufacturing — which includes sawmills and other businesses that make lumber, plywood, wood containers, pallets, flooring, manufactured homes, windows and doors — employed the most people within Maine’s forest products industry and was expected to continue growing, according to a report commissioned by the Maine Department of Economic and Community Development. The wood products sector was the second-largest earner behind paper manufacturing, which has seen job losses.
That year Maine sawmills and other wood products manufacturers raked in nearly $1.7 billion in sales and provided nearly 5,000 jobs across the state. The sawmills grew in part because the price of lumber had doubled in five years, though profit margins weren’t keeping pace with inflated prices, the authors stated.
Now, however, the forestry industry is “in the middle of a sort of slow-motion markets crisis,” said Eric Kingsley, a Maine consultant who contributed to the report.
Kingsley told a gathering of landowners at the Maine Agricultural Trades Show in Augusta last month that he anticipates Maine’s entire forest products industry will face greater headwinds now that tariffs have thrown the market into disarray, and high interest rates have cooled down housing construction, a major driver of sawmill revenue.
“I believe we will come out of this pretty well but not in the next few years,” Kingsley said.
Pain caused by the market turmoil will be especially acute for hardwood lumber manufacturers, according to Kingsley. While U.S. softwood lumber prices have fluctuated since the pandemic, they have been far more stable overall than hardwood lumber prices, which have cratered alongside falling foreign demand.
“Hardwood lumber is in the midst of an epic collapse,” Kingsley said, adding that it likely won’t rebound now that tariffs have damaged relations with trading partners.
That means sawmills producing hardwood lumber often used for furniture and flooring are far more vulnerable to the tariffs than their counterparts that depend on softwood, such as Pleasant River Lumber.
Hard times for hardwood
Lumbra Hardwoods in Milo was already dealing with falling domestic demand when the Trump administration hiked tariffs on Canadian lumber last year. The reciprocal tariffs implemented by Canada then damaged the company’s foreign sales, too, said Stephen Lumbra, the company’s vice president.
One of his largest customers is a flooring company in Quebec, Lumbra explained, and new Canadian tariffs cost him more than $1,000 in duties on every load of lumber he shipped to it.
“We’ve been in business with them since 1984, so it’s been a good relationship,” Lumbra said, but “it was soured last year when everything went to hell” with the tariffs.
Even after the Canadian government repealed some of its tariffs last summer, it took several months before Lumbra’s profits leveled back out and business relations returned to normal.
Lumbra said he gets frustrated when he hears that the rationale behind the Trump administration’s tariffs is to boost American manufacturing. That’s because, even with tariffs, domestic demand for his hardwood lumber isn’t there.
American hardwood lumber production is a third of what it was in 2006, according to Kingsley, and Lumbra doesn’t expect it to rebound anytime soon.
“A lot of people would tell me, ’Just sell your lumber in the U.S.,” Lumbra said. “Well, I can’t because nobody wants it.”
Hardwood lumber production has dropped, but softwood prices have remained stable on average — though they often fluctuate greatly in the short-term.
Back in Enfield, the company has deployed a special weapon to combat volatile softwood lumber prices: a $3.5 million saw that trims timber down to the dimensions that are most valuable.
The machine, made by Finnish company HewSaw, does so by taking hundreds of scans per second of ingoing timber, identifying any weakness or blemishes. It then consults market prices in real time to calculate whether the wood could net the most money as a two-by-four or some other size.
Its processing speed helped make the addition of a second manufacturing shift possible, but Jason Brochu said it’s the tariffs that convinced Pleasant River Lumber that it was feasible.
“We’re looking at a couple more projects, and we feel protected, for once, from Canadian imports,” Jason Brochu said.
The effects of the tariffs aren’t as clear cut to Robbins, the Robbins Lumber vice president, who said that rising energy costs, Canada’s initial retaliatory tariffs and volatile timber prices have all muddled the company’s outlook.
“The tariffs might play a bigger role, but, because demand is somewhat muted, it’s hard to say,” Robbins said.
Whereas Pleasant River Lumber largely sells to American buyers in New England and the mid-Atlantic, Robbins Lumber has Canadian customers in the Maritime provinces, Ontario and Quebec. The company has felt the same pains as Lumbra and hasn’t seen demand change in either country, according to Robbins.
Meanwhile, the U.S. tariffs on imports have simultaneously raised costs for specialty equipment from abroad and decreased demand for the low-grade, scrappy Maine hardwood trees typically sold to pulp and paper mills.
Robbins Lumber’s sawmills in Searsmont and East Baldwin both run softwood. However, loggers need to profit off every scrap of wood they cut, so they drop everything to prioritize selling pulpwood when demand rises again — decreasing softwood timber production, Robbins said.
“These markets are fickle,” Robbins said. “Whenever there is a call for hardwood pulp, what we’ll see is some of the loggers jump on that, and then, all of a sudden, white pine saw logs dry up.”
Maine timber markets are interconnected: Certain changes can benefit one company but hurt another. Many wish for stability.
For Robbins, the company’s outlook is shaped more by the inconsistency of recent policy changes than the tariffs themselves. He’s focused on the long-term, not toiling day to day to decipher the tariffs’ immediate effect on profits.
“We can worry about all this stuff and keep ourselves up at night,” Robbins said. “We’re just trying to make square things out of round things as efficiently and safely as we can.”
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This story was originally published by The Maine Monitor and distributed through a partnership with The Associated Press.