Sumitomo Forestry just bought Teal Jones Louisiana Holdings for $29 million, giving the Japanese timber giant a strategic boost to its US housing supply chain while sidestepping tariffs and other cost headaches.

With this acquisition, Sumitomo Forestry now controls 100 hectares of land and a fully operational lumber mill in Louisiana, ready to churn out enough material for about 14,000 new homes each year. The mill, newly launched this month, lets the company secure supply for its own US housing operations and tap key regional markets like Louisiana and Texas. By adding a local base, Sumitomo can cushion the blow from rising import tariffs and supply chain expenses. The company’s aiming higher, too – there are plans for engineered wood production on 40 extra hectares, and even a possible biomass power plant. Altogether, a larger North American footprint is part of Sumitomo’s push to more than double profits from its timber operations to over 8 billion yen by 2027.

Sumitomo Forestry’s US expansion comes as the demand for building materials stays strong, even with interest rates still elevated. Locking in a US-based lumber supply lets Sumitomo sidestep tariff risks that have pressured Japanese margins. Investors are watching – betting on value-added products and local infrastructure could mean steadier profits and may inspire other Asian firms to follow suit as global trade challenges persist.

The bigger picture: Global supply chains get a homegrown twist.

International firms are ramping up local manufacturing and energy projects, reflecting big shifts in global investment flows and industrial policy. Sumitomo Forestry’s move highlights how companies are adapting to changing trade rules and cost pressure by going local. With global demand for homebuilding still on the rise, the stage is set for more cross-border deals as businesses seek reliable ways to support long-term growth.

Source: finimize.com