Commerce Moving Toward Higher AD/CVD Duties on Canadian Lumber
The Commerce Department is preliminary set to increase antidumping and countervailing duties on Canadian softwood, possibly at the end of November, as a result of AD and CVD administrative reviews, according to notices set for publication soon in the Federal Register.
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The average combined trade remedy against softwood lumber imports from Canada now is about 9%; if finalized, it would roughly double, though each company would face a different combined rate, ranging from 11.38% on West Fraser to 30.22% on Resolute, and other companies in the 15.82% to 21.04% range.
Commerce is inviting interested parties to comment on the preliminary results. Comments on the wisdom of the case have been numerous on Capitol Hill, with members of Congress from both parties have been arguing that even the current tariffs make no sense in a time when lumber is far more expensive than usual. In the House, 96 members asked that the tariffs be removed (see 2105170025); in the Senate, a bipartisan letter was sent earlier this month (see 2105130009); and many senators told U.S. Trade Representative Katherine Tai they want a negotiated agreement on export volumes similar to the one that expired about five years ago. That one allowed Canada to send more imports in when prices started to rise.
Tai said then that Canada was not interested in negotiating a new agreement. But Canada's trade minister, Mary Ng, issued a statement May 21 after the Commerce proposal became public, saying that Canada is open to a new agreement.
“The United States has always relied on Canadian lumber products to meet its domestic needs for high-quality building materials -- and with the overwhelming demand from construction markets over the last year, this has never been more true. The U.S. Department of Commerce’s preliminary results of its second administrative review suggest its intention to significantly increase duties on Canadian softwood lumber later this year. This is entirely unjustified and will hurt consumers, businesses and workers on both sides of the border. ... We remain confident that a negotiated solution to this longstanding trade issue is not only possible, but in the best interest of both our countries," she said.
The U.S. Lumber Coalition, in contrast, said that the duties have led to lumber mill expansion, which is creating American jobs.
“The U.S. Lumber Coalition applauds the Commerce Department’s continued commitment to strongly enforce the U.S. trade laws against subsidized and unfairly traded Canadian lumber imports, " Jason Brochu, the coalition's co-chair, said in a May 21 statement.