Trump sets new rates on Canadian wood: this is what investors need to know

President Donald Trump of the United States has added new rates this week, in particular calling the Canadian wood. The enforcement of a section 232 action came as a huge shock for the sector. The relocation gives the products on the products in the short term, with the potential to print shipments to the United States. This can be huge, given the cross -border dependence that Canada has of our neighbors in the south.

This combination can therefore be quite difficult for the Canadian wooden producers, with more volatility, weaker profit in the short term, guidelines and a return to former tariff issues. The immediate effects are negative; However, the long term can offer some Canadian shares value. So let’s see what investors should not only know in the short term, but also in the medium and long term.

WFG

Let’s look at one of the greatest producers there are, West -Fraser (TSX: WFG). This is a large, integrated supplier with wood exposure, oriented strict board (OSB) and pulp. Although it remains liquid and has flexible activities, the second quarter showed that the risk can run at these new rates.

In the second quarter, sales amounted to US $ 1.5 billion, with a net loss of $ 24 million. The adjusted income before interest, taxes, depreciation and amortization (EBITDA) reached US $ 84 million, with wood only US $ 15 million. Again, the money is solid at US $ 646 million, so that it can buy back around $ 450,000 shares so far. Yet the guidance has already been reduced.

The management reduced 2025 shipping piking and reduced OSB services the way the demand has already been relaxed. So these rates will probably hit the Canadian shares even harder. While capital expenditures remain heavy for US $ 400 to US $ 450 million. All in all, West Fraser has been one to stay on the watchmist and it will stay today.

Sj

Another option is Stella Jones (TSX: SJ), which offers another product mix of pressure -treated wood, utility piles and industrial wood products. Rates on wood are therefore less directly for core markets, but the weakness of the sector could still touch the company in the field of prices and the demand for these products.

That said, his financial data looks a lot healthier. It maintains a strong EBITDA at $ 189 million or a margin of 18.3%. However, that does not mean that it is perfect. Turnover fell by 1% compared to last year, with an operating result at $ 155 million from $ 168 million in 2024. This led the Canadian shares to fall the expected turnover in 2025 to $ 3.5 billion of $ 3.6 billion – again influenced by the macroeconomic challenges.

However, there is a silver lining. The Canadian shares continue to buy back shares and try to create growth through acquisitions. This included the acquisition of Brooks Manufacturing in September for around US $ 140 million. If the deal is good, investors can still see growth despite all these rate issues.

Bottom Line

We rates the Canadians certainly hurt more than they help. However, they can also create opportunities if you invest in the right companies. Unfortunately, WFG looks like it is struggling even without the rates. SJ is also, but tries to create growth through smart investments. In every respect I would simply add this to your watchist instead of going all the way in a dip.