For years, a sheet of plywood manufactured in China has sometimes cost less, landed at a U.S. job site, than the raw materials needed to make the same sheet domestically. In February 2026, the U.S. Department of Commerce gave a striking answer as to why. Its preliminary antidumping determination on hardwood and decorative plywood from China calculated a dumping margin of 187.27 percent, layered on top of an 81.34 percent countervailing duty tied to government subsidies [1]. In plain terms, regulators found that Chinese plywood was being sold in the U.S. at less than half its fair value, further propped up by state subsidies. The Coalition for Fair Trade in Hardwood Plywood, which brought the case, said the domestic industry had been harmed for decades by dumped and subsidized plywood [1]. This single finding sits among 757 active antidumping and countervailing duty orders currently in force across the U.S. economy [1], a scale that surprises most people outside the trade.
Dumping happens when a product is sold abroad below its cost of production or home-market price, in a way ordinary competition would not sustain. Plywood is not isolated: Chinese steel exports topped 100 million metric tons in 2024, the OECD projects global steel overcapacity will reach 721 million metric tons by 2027 [4], and Chinese solar production now accounts for roughly 80 to 90 percent of the global supply chain [4][6]. The pattern recurs across steel, aluminum, solar, EVs, and now hardwood plywood, the category most directly relevant to construction.
Why this happens is a genuinely debated question. One view, widely held among U.S. trade officials, treats it as deliberate industrial policy: subsidizing production at a scale that outstrips domestic demand, with the foreseeable effect of pricing foreign competitors out over time. A different, increasingly prominent explanation comes from economists studying China’s own internal accounts. Chinese policymakers have started using the term “involution” to describe hypercompetition among local governments and firms chasing growth targets, each expanding capacity independently until the sector collapses into oversupply, not a coordinated top-down strategy [5]. Both explanations may be partially true, and researchers continue to debate the weighting [4]. What is not in dispute is the outcome: persistent underpricing that has forced job losses and consolidation in the industries on the receiving end [2][4].
Whatever the cause, U.S. trade policy has responded with active enforcement. Tariffs now stack across several legal authorities at once, alongside product-specific orders like the plywood case, pushing effective rates on some Chinese steel and aluminum products above 65 percent before standard duties even apply [3]. For an industry built on fixed-price contracts, this has become a real planning variable: a material priced competitively at contract signing can carry a meaningfully different cost by delivery, and a price suppressed for years below its real cost distorts the baseline the market uses to judge what an alternative material should cost.
The effect is not abstract in California. The state already has one of the least affordable housing markets in the country, and tariff-driven material costs are landing directly on top of that. The California Building Industry Association has estimated that tariffs on steel, aluminum, and lumber could add $35,000 to $45,000 to the cost of building a single home [8], a particularly sharp problem as the state works to rebuild after recent wildfires. Statewide, construction input prices rose at a 12.6 percent annualized rate in early 2026, the fastest pace since 2022 [9], compounding a housing shortage that is already driven as much by cost as by supply. Material costs that are inflated by dumping-driven trade enforcement, on top of California’s existing affordability pressure, make domestically produced alternatives a more direct lever for cost stability than they were a few years ago.
ECOR’s panels are manufactured from agricultural and urban waste fiber sourced domestically, without the cross-border exposure currently affecting plywood. That distinction does not solve California’s broader housing shortage on its own, but it removes one source of cost volatility from a project’s materials budget at a moment when that volatility is landing hardest on the state that can least afford it.
Sources
[1] Wiley LLP, “Commerce Department Issues Affirmative Preliminary Antidumping Duty Determinations on Hardwood and Decorative Plywood from China, Indonesia, and Vietnam,” February 2026.
[2] Alfaro, L. & Chor, D., “The US Supply Chain Shakeup After Tariffs, in Five Charts,” Harvard Business School Working Knowledge, April 2026.
[3] Tax Foundation, “Tariff Tracker: 2026 Trump Tariffs & Trade War by the Numbers,” May 2026.
[4] Brookings Institution, “How the US should address Chinese overcapacity and its impact on international trade,” January 2025.
[5] Institute on Global Conflict and Cooperation (IGCC), “Chinese Overcapacity Looms Over the APEC Summit,” October 2025.
[6] East Asia Forum, “China’s industrial policy a recipe of overcapacity,” December 2025.
[7] European Parliament, “Industrial overcapacities, with a focus on China,” 2026.
[8] Woodworking Network, “California strengthens rebuilding efforts amid tariff uncertainty,” February 2025, citing California Building Industry Association estimates.
[9] Construction Owners, “50% Steel, Aluminum, Copper Tariffs Raise Construction Costs in 2026,” April 2026.
