Wednesday, April 30, 2025
In line with Setra’s yearly report, the US is the world’s largest market for timber goods due to the sustained high demand for wood products, with an annual turnover of about 90 million cubic meters of wood. The US construction business has both opportunities and problems due to a shifting trade policy environment, expanding housing demand, and rising building prices. However, what propels the US market and sustains robust demand?
The United States is far from self-sufficient, and imports from Canada and Europe are essential to meeting the need for wood products and keeping up with construction. Domestic manufacturing meets around 70% of the needs in the American market. Although it is still difficult to estimate the exact impact, the recently discussed tariffs may have a variety of effects on the market. “The biggest challenges are the political uncertainty surrounding the tariffs, which affects everything from prices to supply and demand. Freight and logistics could also be affected if the flow in the tariffs changes,” comments Olle Berg, Director of Market and Business Development at Setra.
Significant fundamental housing necessity
At the same time, the United States has a significant underlying housing need. As the gap between income levels and housing costs widens, the generation born around the turn of the millennium is now beginning a family and planning to purchase a home, but many find it challenging to get into the market due to current borrowing rates and rising prices. The fact that there is typically insufficient building concerning the need is another problem.
One million of the 1.5 million homes that were expected to be built before the US election were single-family dwellings, representing a 150,000–200,000 increase over 2024. Post-election uncertainties have lowered the forecast, still falling short of the needed 1.6–1.7 million homes. “The US has not built at the pace with population growth since the financial crisis in 2008. This has led to a large part of the housing stock being older, which increases the need for renovation. The ROT sector currently accounts for half of the annual wood consumption in the US,” notes Olle.
Sustained great promise in the US market
Housing trends in the US are changing with a focus on smaller, more energy-efficient homes using wood for practical and cost advantages, although awareness of wood sustainability is less compared to Europe. Detached timber houses, mainly two by four, are popular, with slowly growing investment in CLT construction facilities in the US and Canada. “The USA will be dependent on wood imports for a long time to come, which makes the market interesting for both Setra and other players in Sweden and Europe. We are continuously increasing our volumes and our product range within the construction segment in the American market. We are also looking at expanding with another distribution warehouse to broaden the customer base and get closer to more regional markets,” concludes Olle.
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