Softwood lumber: It’s not over yet

November 3, 2017

By: The Working Forest Staff

Most Canadian companies are facing slightly lower duties on softwood lumber imported to the U.S., now that the U.S. Department of Commerce has made its final determination. However, there remains a key decision to be made by the U.S. International Trade Commission. This body determines if the American industry has been “injured” by Canadian softwood lumber imports to the U.S.

If the ITC finds no injury, the Department of Commerce case with be terminated and no duties applied. If the ITC finds injury, the Commerce Department will issue orders to collect duties. The ITC is expected to announce its decision around Dec. 18, 2017.

In a joint statement, The Honourable Chrystia Freeland, Minister of Foreign Affairs, and the Honourable Jim Carr, Minister of Natural Resources, said: “The U.S. Department of Commerce’s decision on punitive countervailing and anti-dumping duties against Canada’s softwood lumber producers is unfair, unwarranted and deeply troubling.

“We will forcefully defend Canada’s softwood lumber industry, including through litigation, and we expect to prevail as we have in the past.”

The Ministers are reviewing their options, including legal action through the North American Free Trade Agreement and the World Trade Organization.

Freeland and Carr said they also continue work towards negotiated agreement on softwood lumber with their American counterparts.

The final determinations of the antidumping duty (AD) and countervailing duty (CVD) investigations of imports of softwood lumber from Canada were announced Nov. 2. As a result, Commerce will instruct U.S. Customs and Border Protection to collect cash deposits from importers of softwood lumber from Canada based on the final rates.

“While I am disappointed that a negotiated agreement could not be made between domestic and Canadian softwood producers, the United States is committed to free, fair and reciprocal trade with Canada,” said Commerce Secretary Wilbur Ross in a statement.

Ross went on to say the decision “is based on a full and unbiased review of the facts in an open and transparent process that defends American workers and businesses from unfair trade practices.”

The Commerce Department determined that exporters from Canada have sold softwood lumber the United States at 3.20 per cent to 8.89 per cent less than fair value.  Commerce also determined that Canada is providing unfair subsidies to its producers of softwood lumber at rates from 3.34 per cent to 18.19 per cent.

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