{"id":19876,"date":"2024-08-14T23:30:53","date_gmt":"2024-08-14T13:30:53","guid":{"rendered":"https:\/\/woodcentral.com.au\/?p=19876"},"modified":"2024-10-21T20:17:27","modified_gmt":"2024-10-21T10:17:27","slug":"usa-slaps-huge-duty-on-canadian-lumber-timber-price-rises-next","status":"publish","type":"post","link":"https:\/\/woodcentral.com.au\/usa-slaps-huge-duty-on-canadian-lumber-timber-price-rises-next\/","title":{"rendered":"USA Slaps Huge Duty on Canadian Lumber: Timber Price Rises Next?"},"content":{"rendered":"\n

Canada is subsidising and deliberately dumping softwood lumber into the United States market, distorting the American softwood lumber market to the detriment of US sawmills, their employees, and communities.<\/p>\n\n\n\n

That is according to the US Department of Commerce, which has (almost) doubled its anti-subsidy and anti-dumping duty (now 14.54%) on all Canadian softwood entering the US \u2014now more than 84% of all lumber imported into the world’s second-largest consumer market for timber.<\/a><\/p>\n\n\n\n

The decision, which has caught almost all analysts by surprise<\/a>, means that the previous duty (8.05%) has increased by more than 80% – a move that could cause an enormous ripple in the trade of softwood across the border, which, over the last quarter, reached 7.455 million cubic metres.<\/p>\n\n\n\n

\"United<\/figure>\n\n\n\n

In a written statement,\u00a0Mary Ng, Canada’s minister of export promotion, international trade and economic development, expressed her deep disappointment with the increase. <\/p>\n\n\n\n

“Baseless and unfair US duties on softwood lumber unjustifiably harm consumers and producers on both sides of the border. This latest measure will negatively impact workers and their communities,” Minister Ng said.<\/p><\/blockquote><\/figure>\n\n\n\n

Whilst in British Columbia, considered the epicentre for softwood, Bruce Ralston, BC’s Minister of Forests, echoed Minister Ng’s sentiments:<\/p>\n\n\n\n

“I am immensely disappointed with the US Department of Commerce’s decision to increase unfair and unwarranted softwood lumber duties,” according to Minister Ralston.<\/p>\n\n\n\n

The Canada\u2013US softwood lumber dispute is one of the nation’s most significant and enduring trade disputes. First arising in 1982, it remains largely unresolved more than 40 years later. Under the US Tariff Act, the Department of Commerce determines whether goods are being sold at less than fair value or benefiting from subsidies provided by foreign governments.<\/p>\n\n\n\n

\"America
America is now flooded with an oversupply of lumber, with the failure of Fed Reserve rate cuts leading to a stop-start housing economy. (Photo Credit: Maksym Yemelyanov \/ Alamy Stock Photo)<\/figcaption><\/figure>\n\n\n\n

In Canada, lumber-producing provinces set so-called stumpage fees for timber harvested from Crown land, a system that US producers \u2014 forced to pay market rates \u2014 consider an unfair subsidy.<\/p>\n\n\n\n

Yesterday, the US Lumber Coalition, an industry group, claimed\u00a0the Department of Commerce’s rate decision “substantiates that Canada continues to subsidise and dump its softwood lumber products in the United States.”‘<\/p>\n\n\n\n

The coalition said Canadian practices distort the US softwood lumber market, affecting sawmills, their employees, and communities in the United States: <\/p>\n\n\n\n

\u201cThis even higher level of unfair trade by\u00a0Canada\u00a0could not have come at a worse time for domestic producers,\u201d according to Andrew Miller, Chairman of the U.S. Lumber Coalition. \u201cLumber demand and prices are at record lows, and mills across the country are struggling to keep afloat.\u201d\u00a0<\/p>\n\n\n\n

What is the impact of duties and tariffs on retail pricing?<\/h6>\n\n\n\n

In 2021, Canadian economists calculated that by doubling duties (from the normal rate of 8.99% to 17.99%), the US Department of Commerce effectively added US $99.00 to the cost of a thousand board feet of wood. increase per thousand board feet of wood.<\/p>\n\n\n\n

\"Canadas<\/figure>\n\n\n\n

As one of the world\u2019s largest exporters of softwood, Canada exports enormous quantities of lumber to the United States, China, Japan, and Taiwan, which together account for CA $8 billion worth of softwood exports.<\/p>\n\n\n\n

As for the future, Minister Ng has vowed to challenge the US decision with litigation\u00a0under the North American Free Trade Agreement (NAFTA) and\u00a0the\u00a0Canada-United States-Mexico Agreement (CUSMA)\u00a0at the\u00a0US Court of International Trade and the World Trade Organization.<\/p>\n\n\n\n

“It is in the best interests of Canada and the United States to find a lasting resolution to this long-standing dispute,” Minister Ng.<\/p>\n\n\n\n