Explaining tariff impact on lumber, cabinets, and upholstered furniture

SOUTH BEND, Ind. --- New tariffs on furniture and lumber went into effect on Tuesday. This includes cabinets, vanities, and upholstered furniture.  

According to the Associated Press, President Trump signed a proclamation in late September, pinpointing national security and foreign trade practices as reasons for the new tariffs imposed on some finished wood products and their components. 

According to the AP, vanities and kitchen cabinets that are imported will have a 25% rate until the end of the year, rising to 50% on January 1, 2026. Upholstered furniture like chairs, seats, and sofas —also seeing a 25% tariff— are set to go up to 30% on January 1st as well. There’s also a 10% tax on imported softwood timber and lumber, which typically comes from pine and cedar trees. 

Pete Theran, CEO of the Home Furnishings Association (HFA), explained the nature of these tariffs. 

“This tariff is positioned as being underneath a trade expansion act, specifically targeted at lumber. So you might say, ‘Well, I don’t understand, why is upholstery in that?’ The frame of an upholstered product is generally made of lumber, not always, but generally. And so, there is a targeted product group that is a little bit different than what you might intuitively think about, but that is the premise of the tariff, is that it is a wood-framed product,” said Theran. 

He says upholstered furniture like sofas or upholstered chairs will be impacted. He says a lot of upholstered furniture comes from Asian markets–like China or Malaysia, the EU, and specifically Italy, as well as South America. He says the US also has a “large and thriving upholstered manufacturing industry” in a handful of states, like North Carolina, Mississippi, and Virginia. 

“It does not, by and large, affect what we call ‘case goods’, which most people just think of as wood furniture. So, the only part of the tariff that impacted that type of product is cabinets, primarily kitchen cabinets, and it is restricted to products that would be permanently affixed to a wall,” said Theran. 

So, how quickly will you see impacts? 

“It may happen quicker than it would usually, because there was no on-the-water exemption. So, in other words, if your container of sofas is sitting on a boat somewhere between here and its port of origin, it doesn't matter what tariff was in place when it left port. You pay the tariff that's in effect when it arrives,” said Theran. 

He says people will feel the impacts in retail pricing in two ways. 

“One is the landed cost of product, meaning how much the importer pays for product when it lands on our shore, goes up by the amount of the tariff. So some, or all of that will trickle down to retail pricing. Now, why do I say some? In some cases, if there are multiple layers of the supply chain, like there is a factory that sells to a larger corporation that exports that then to another company that imports that sells to a retailer, they will try to share the pain, sometimes among all those layers of supply chain. But a directly sourced product, like a retailer who sources their own product, largely, will be absorbing all that tariff impact and that landed cost will result in a higher price,” said Theran. “The second way it will impact prices is even what we call a domestic produced product, a product called Made in the USA, oftentimes, is the assembly of parts sourced from other countries. Easiest example in upholstery would be a large portion of fabrics for upholstered products come from China. So, as the supply chain looks to adjust to the impact of tariffs, that's not something that happens overnight. Even made in the USA products may see impact from tariffed components of their products.” 

Some countries were able to avoid this particular tariff through trade agreements, like for the UK, there’s a 10 percent cap on the tax for exports, with Japan and the EU capped at 15 percent. 

According to ABC News, the cost of building a home has been rising, and tariffs on lumber are projected to contribute to that. A UBS report says new tariffs on these wooden products might add $1000 to home-building costs, which have already gone up $8,000 this year due to tariffs. 

Blake Taelman is the Co-owner of Capstone Design + Build in Granger. The company designs and builds new homes across the region. 

Taelman says homes typically take a year to a year-and-a-half to build. When a contract is signed, he says they purchase material earlier than normal to lock in prices. He says pricing is set once they have a signed contract, but before then, it is subject to change based on announced tariffs. 

“So a lot of it depends on what type of material that you're sourcing, but anything that's coming from overseas is there's always a looming price increase. It's either something that has been announced already or something that you're worried is going to come down the line,” said Taelman. 

Price increases used to be more predictable, but now, he says, they can really happen at any time. 

“I think everybody understands, I guess, the climate that we're in right now. And so, you just have to get used to a little bit of uncertainty until it shakes out,” said Taelman. 

He says some of the biggest impacts on pricing are from tile. 

“Most recently with tile, that's imported largely from overseas, that has had probably three price increases this year already, and we're expecting another. And so, it really just depends on the type of material, but yeah, there's, there's already been price increases across the board, and we're expecting more,” said Taelman. “For us, we're feeling tile the most, but the big concern is if softwood lumber imported from Canada is drawn into more tariffs because we import as a country about 30% of our softwood from Canada, and it makes up a pretty large percentage of the overall cost of the home.” 

LaVern Miller, the owner and CEO of Teaberry Wood Products in the Middlebury area, spoke to ABC57 about lumber prices and tariffs. They specialize in handmade wooden products and home decor, as well as baskets. 

Miller says in terms of lumber, they aren't really seeing price impacts for the native wood from local mills. However, they purchase what they call ‘exotic wood’ from a local mill, and that lumber is imported from different places. Miller says they’ve seen the cost of many of those types of wood go up a lot. He says most of that happened after the pandemic, but recently, prices have just continued to go up. 

On the flip side, Miller thinks tariffs are helping to make them more competitive. He says that with home decor or other products, the price of similar items from China used to sell for half the price of theirs. Now those prices are more similar to theirs.