The B.C. Lumber Trade Council says countervailing duties imposed by the U.S. are unfounded and the association will fight the ruling.
Yesterday the U.S. Department of Commerce imposed punitive preliminary countervailing duty rates on Canadian softwood lumber in response to a petition filed by the U.S. lumber lobby. In this preliminary determination, countervailing duty rates imposed are as follows: Canfor 20.26 per cent, JD Irving 3.02 per cent, Resolute 12.82 per cent, Tolko 19.5 per cent, West Fraser 24.12 per cent, and 19.88 per cent for all other British Columbian and Canadian producers.
“These duties are unwarranted, and this determination is completely without merit,” said Susan Yurkovich, President of the BC Lumber Trade Council, in a press release. “The allegations made by the U.S. lumber lobby are the same arguments they made in prior rounds of litigation, all of which were rejected and overturned by independent NAFTA panels. This new trade action is driven by the same protectionist lumber lobby in the U.S. whose sole purpose is to create artificial supply constraints on lumber and drive prices up for their benefit, at the expense of American consumers.”
The U.S. Department of Commerce [DOC] also found “critical circumstances” which means duties will be retroactive 90 days for all companies other than the mandatory respondents.
“The finding of critical circumstances in this case represents an unprecedented departure from the DOC’s typical approach and produces an entirely arbitrary result,” said Yurkovich. “American demand for lumber exceeds what the U.S. lumber industry currently produces. And, with housing and construction starts on the rise, demand for lumber is expected to continue to grow in the years ahead. The fact is, Canadian lumber imports don’t pose a threat to the U.S. lumber industry. There is enough North American demand to grow the U.S. industry while also allowing Canada to supply its U.S. customers as we have been doing for decades.”
Constraining Canadian lumber imports by applying punitive duties creates price volatility in the lumber market. These duties are being reflected in higher lumber prices, driving up costs for American consumers, especially for families who want to build, buy or renovate a home in the U.S., she said. Concern about the impact of duties on American families and homebuilders is already being expressed by the U.S. National Association of Home Builders (NAHB). Their analysis shows that even with a 15 per cent tariff, there would be a loss of 4,600 American jobs and $265 million in lost wages and salaries in the U.S. residential construction and renovation industry alone.
“Canada and the U.S. enjoy one of the most productive trading relationships in the world, and the North American lumber market has always been served by both American and Canadian producers,” said Yurkovich. “BC Lumber Trade Council continues to believe that reaching a new agreement is in the best interests of producers and consumers on both sides of the border and we will continue to work closely with our provincial and federal governments to support efforts to reach a new agreement. However, with this U.S. trade action, we will also continue to vigorously defend our industry and our workers against these unwarranted duties and expect to be successful as we have been in the past.”
B.C. is the largest Canadian exporter of softwood lumber to the U.S. The B.C. forest industry is a major contributor to the provincial economy and supports approximately 145,000 direct and indirect jobs in the province. The BC Lumber Trade Council is the voice on trade matters for companies in British Columbia representing the majority of B.C. lumber production.