US finds Canada lumber harms US producers; duties to remain

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The U.S. International Trade Commission said on Thursday it made a final finding that exports of softwood lumber from Canada injure U.S. producers, virtually ensuring that hefty duties on imports of the building material will remain in place for five years.

A USA trade panel on Thursday unanimously ruled to uphold hefty duties on Canada's softwood lumber industry saying the US industry has been harmed by unfair practices.

"The massive subsidies that the Canadian government provides to its lumber industry and the dumping of lumber products into the USA market by Canadian companies cause real harm to US producers and workers", Coalition Co-Chair Jason Brochu said in a statement.

The U.S. Commerce Department last month lowered preliminary duties.

US finds Canada lumber harms US producers; duties to remain
US finds Canada lumber harms US producers; duties to remain

The department determined most Canadian producers will pay an average, combined antidumping/countervailing duty of 20.83 per cent.

Reasons supporting the vote are expected to be released in two weeks.

"As we've discussed throughout this dispute, the imposition by the U.s. of anti-dumping and countervailing punitive damages on the softwood lumber in canada is unjustified and disturbing".

The tariffs, outlined by the Commerce Department in November, would add duties that range from about 10-24%, depending on the company, which is lower than an earlier proposal.

However the value of those imports went up very slightly - 0.15 per cent - because even though less wood was shipped, each piece of lumber was worth more.

A USA home-builder group has called the ruling "shortsighted" amid concerns that it would drive up prices for consumers.

"If we were not seeing the same kind of demand and the same kind of high prices we're seeing then we might be in an entirely different type of situation", said Neuheimer.

The dispute is expected to further add to tensions between the USA and Canada, which are in the midst of negotiating, with Mexico, a rewrite of the North American Free Trade Agreement.

The ruling comes amid a growing number of trade disputes between the USA and Canada and is likely to complicate already tense negotiations over Nafta.

Canada has appealed to worldwide panels in the dispute. Canada also kicked off a process to challenge the tariffs at the World Trade Organization, the global trade arbiter that is under increasing pressure from the Trump administration.