Eisnor’s Forestry Ltd., based out of Mahone Bay, N.S., is one of many businesses worried about the impact of U.S. tariffs. They ship as many as 15 truckloads of wood daily to mills around the province to be processed into lumber for the U.S market.
“It has a detrimental effect on me because 80 per cent of my revenue could be zero. And with the tariffs and if they can’t send their product, or they have to reduce the price of what they pay for their product, 25 per cent, my company, we have annual sales of $4 million a year, we work on an eight per cent profit margin and so you take 80 per cent of my profit, my business doesn’t exist,” says co-owner Kevin Eisnor.
Eisnor does not sell directly to the States, but his customers do so whatever impacts them will ultimately affect him and his 20 workers.
“We employ 20 people full time and that’s 20 families that me and my co-owner, you know, we try to feed, and they have families. And it puts us in a tough spot because I’m uncertain what the mill will do, what they can do and this business, as you look around it’s big investments and if you take 15 of these units, how do you pay for them?” says Eisnor. “I have employees calling me, and I don’t have any answers, I don’t know what to tell them. I talk to mill owners, and I ask them and they don’t have any answers.”
Eisnor was planning to invest in the company’s machinery but has put this on hold after the implementation of the tariffs this week.
“Everything is at a standstill because we don’t know how to move forward or if we should move forward,” says Eisnor.
He is certainly not alone as forestry firms around the region are facing the same dilemma.
Ledwidge Lumber loads around a half a dozen trucks for the U.S daily.
“Our product is eight-to-10-foot studs that are really bound for North American-style homes so we need to ship to a market that builds North American-style homes,” says president Doug Ledwidge.
They also ship to Europe, but the American market is more lucrative.
“We are still here for business for our Canadians consumers, which we have lots of good customers in that field, but there is just not enough business around to sell all our product and we do have a long-standing relationship with exporting product to the eastern seaboard of the U.S,” says Ledwidge.
Freeman Lumber ships more than 50 per cent of their product to the U.S and they are worried about the long-term effects of the tariffs.
“Essentially 50 per cent of whatever we make and the associated jobs, production and revenues to woodlot owners in Nova Scotia will cease to exist,” says chief operating officer Marcus Zwicker.
Zwicker says the additional 25 per cent will come out of the pockets of their American customers, but they can’t predict if they will be willing to pay extra and if this will impact demand.
“The impact it has on us is that it directly puts those relationships we have had – some of them for decades – with consumers in the United States that rely on our lumber for their hardware stores or wall panels factories or floor factories or pallet machines or whatever those are, could be as simple things as bag shavings for horse bedding; all of the sudden that for us the same business on the other end has to pay 25 per cent more for that same product,” says Zwicker.
“Eventually, if demand does go down, there is less pressure for mills to supply that demand and maybe there will be curtailments and maybe there’ll be less production is the case for other forestry companies though as well,” says Todd Burgess, executive director of Forest Nova Scotia.
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