According to industry sources, Canadian Northern Bleached Softwood Kraft (NBSK) pulp producers are still in negotiations regarding price adjustments in the event of an escalating trade war between Canada and the US. Some producers appear to be more amenable to lowering prices slightly to share the burden with US importers. Sources within the Canadian pulp, paper and wood industry have indicated the market’s acceptance of a new round of tariffs being implemented between the US and Canada on April 2.
Recent comments by Canadian political parties on both sides of the aisle and moves by the government indicate that Canada may be settling in for a prolonged trade war with the US. As elections are approaching and the current Liberal party government is behind in the polls, it will need to maintain a tough stance against US tariffs and threats to Canadian sovereignty if it is to appeal to voters. Positive movement in Liberal party polling over the past couple of weeks has all but confirmed this, and it is expected to continue its hard line against US tariffs.
Statements by US Commerce Secretary Howard Lutnick, who recently commented that the Canadian response to US steel and aluminum tariffs was “tone deaf”, and the Canadian Prime Minister Mark Carney, who stated that US President Donald Trump needed to stop commenting on annexing Canada “before we sit down and have a conversation”, are also being interpreted by industry participants as an indication that tariff implementation at the beginning of April is all but certain. Further moves by the Canadian government, such as a ~$3.5 billion program to help find new markets for Canadian products, $350 million in favorable loans to impacted businesses, and $700 million in additional financing for food and agricultural producers, also indicate prolonged trade difficulties with the US.
Authored by:
Greg Potter
Expana
[email protected]
