Weyerhaeuser's stock is gaining as investors anticipate that the company will benefit from new 25% tariffs on Canadian lumber imports. The Seattle-based firm, which owns 10.4 million acres of timberland in the U.S. and logging rights on another 14 million acres in Canada, is expected to sell lumber and wood panels at higher prices without the added cost of tariffs on cross-border shipments.

Approximately 80% of Weyerhaeuser's lumber milling capacity is located in the U.S., and the company primarily sells its Canadian production within Canada, according to CEO Devin Stockfish. While Weyerhaeuser exports some Canadian-made oriented strand board (OSB) to the U.S., it represents a small portion of its total wood panel production in North America.

The new tariffs will be applied in addition to existing duties on softwood lumber imports from Canada, which are set to increase from the current 14.4% rate this summer. Stockfish noted that prices will likely rise to maintain profit margins for Canadian producers exporting to the U.S., or production capacity may decrease as a result.

With about 25% of lumber and 30% of OSB consumed in the U.S. coming from Canada, the potential reduction in Canadian supply is expected to push prices higher until demand adjusts.