Canadian softwood producers to be slapped with 20.83% duty

Canadian softwood producers to be slapped with 20.83% duty

That move turned out to be successful in 2017, with the Commerce Department deciding to penalize Canadian producers, first with countervailing duties starting on April 28 and then anti-dumping duties beginning on June 30.

This week, the United States cut tariffs on Canadian softwood lumber, including product originating in Newfoundland and Labrador.

The lumber duties are "unjust and punitive" and Canada will continue to push back against American industry, Prime Minister Justin Trudeau told reporters in Brampton, Ontario.

But the B.C. government is also aggressively trying to push B.c. lumber into Asian markets.

The U.S. Lumber Coalition countered that massive Canadian subsidies have caused real harm to U.S. producers and their workers. To counteract unfair subsidies, countries may also introduce countervailing duties.

"I'm sure everyone is relieved (today), we certainly are, but you never know when you're in these negotiations", McNeil said. The moratorium on trade litigation ran out in October 2016, and US lumber interests started calling for trade sanctions on Canadian wood.

In its final determination, Commerce said most Canadian producers will pay a combined countervailing and anti-dumping rate of 20.83 per cent, down from 26.75 per cent in the preliminary determinations issued earlier this year.

"The U.S. continues to attack its closest friend, neighbour and ally while domestically the U.S. lumber coalition continues to put the interest of its members ahead of what is good for the American economy and American consumers", Bruce Ralston, minister of Jobs, Trade and Technology, said in a press release.

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U.S. Commerce Department officials have ruled that Canada unfairly subsidizes the cost of logs it provides to Canadian timber companies, setting the stage for new tariffs on wood imports to the United States.

"This 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".

Susan Yurkovich, President of the British Columbia Lumber Trade Council, said the duties are driven by a protectionist US lumber industry whose sole goal is to constrain the imports of Canadian lumber and drive up prices for their own benefit. Cracking down on US deficit has been one of the core principles of this administration. These duties are a tax on American middle-class families too, whose homes, renovations and repairs will only be more expensive.

The ministers said Ottawa will turn to litigation if required to defend the industry and expects to prevail as it has in the past.

"We are reviewing our options, including legal action through the North American Free Trade Agreement (Nafta) and the World Trade Organization, and we will not delay in taking action", they said.

The department also believes Canada had unfairly subsidized the lumber exports at between 3.3 percent and 18.2 percent.

The dispute helped to spark a surge in lumber prices in the US, with the increased uncertainty over supplies coming at the same time as a recovery in the American housing market.

The United States imported $5.7 billion worth of Canadian softwood lumber in 2016, according to the department, up from $4.5 billion in 2015.