US ITC 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.

Susan Yurkovich, President of the BC Lumber Trade Council, which represents lumber producers in British Columbia, the largest Canadian exporter of softwood lumber to the US, said the ruling by the commission "is completely without merit".

The U.S. Lumber Coalition, which filed a petition past year with the Commerce Department to open a case against Canada's softwood lumber industry, praised the decision. "The U.S. Coalition's claims of injury ring particularly hollow given the extraordinary financial performance that the U.S. lumber industry is enjoying, and given that Canadian imports are at a lower level today than at the levels deemed non-injurious under both the 2006 Softwood Lumber Agreement and by the ITC itself in the last round of litigation".

"The U.S. Lumber Coalition fully supports the enforcement of America's trade laws".

West Fraser Timber pays the highest duties at 23.7 per cent. Canfor is next at 22.13 per cent, followed by Tolko at 22.07, Resolute Forest Products at 17.9 per cent and J.D. Irving at 9.92 per cent.

The Department of Commerce will now issue antidumping and countervailing duty orders on such imports from Canada, the commission said.

A US homebuilder group has called the ruling "shortsighted" amid concerns that it would drive up prices for consumers.

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Demand from USA builders for lumber remains high and the additional cost is wrapped into the cost of new homes in the U.S.

In 2016, Canada exported rough $5 billion in softwood lumber to the U.S.

Although workers in the Canadian industry fear layoffs, so far that hasn't happened, says Joel Neuheimer, vice-president of global trade and transportation for the Forest Products Association of Canada.

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

Those fees are lower than fees paid on USA timber, which comes largely from private land.

In testimony this week before lawmakers, Canada's chief Nafta negotiator, Steve Verheul, said the softwood dispute between the US and Canada "will continue to be a hard issue" and said it is unlikely a solution will be incorporated in any renegotiated continental trade pact. The NAFTA dispute panel has to make a ruling by next fall.