Demand rests on a narrow base as costs re-accelerate; new US and Canada tariffs widen the input-cost risk

The tariff dispute with Canada reopened in August. Washington put a 50.0% duty on about US$20bn of Canadian goods, including plywood, engineered wood and Portland cement and Ottawa answered with dollar-for-dollar retaliation from 8 September 2026 Softwood lumber and Section 232 metals sit outside the new round, so the direct hit lands on sheathing, engineered-wood and concrete-led scopes. Plywood was already running 9.0% year-on-year in the first July readings, up from 6.3% in Q2. Until the two sides settle, carry wider contingency on cement and wood linked packages and lock pricing early.

Backlogs ended the H1 where they began. From January's four-year low of 8.0 months, they rebuilt to 9.1 by May, then gave it all back, with ABC's July survey reading 8.0 again. A pipeline that fills in spring and thins by midsummer gives contractors little reason to bid for work cheaply on the expectation of a fuller book later.