Softwood tariffs launched
The Canadian Press - Apr 24, 2017 - Business Buzz

Photo: The Canadian Press

The United States has fired the opening shot in the latest softwood-lumber war against Canada, with the Trump administration announcing its first batch of duties on imported wood in the neighbourhood of 20 per cent.

The move was expected: the deep-rooted dispute over lumber pricing between the two countries has led to once-a-decade trade skirmishes over the issue, resulting in American duties, then the inevitable court battles, and ultimately negotiated settlements.

What wasn’t expected Monday was the enthusiasm with which the new American administration flung itself into the lumber hostilities, touting its incoming countervailing duties as an example of U.S. President Donald Trump’s tough, America-first trade posture.

Trump underscored the impending move by announcing it to a gathering of conservative media on the eve of the expected announcement. Commerce Secretary Wilbur Ross also highlighted it in an interview.

Then came a statement that said U.S. Customs will begin collecting cash deposits from Canadian logging companies because they receive a range of subsidies — most of them around 20 per cent.

What comes after the countervailing duties is a study of possible anti-dumping duties, followed by a final determination by the U.S. Commerce Department as early as Sept. 7, and one of three possible outcomes: an agreement, a surprise retreat from the U.S. government or potential years-long court battles.

It will all play out amid the backdrop of a bigger trade file: the renegotiation of the North American Free Trade Agreement.

America’s lumber lobby applauded the announcement.

“We are pleased with this initial outcome and are looking forward to the (next, anti-dumping) duties expected to be announced June 23,” said Zoltan van Heyningen of the U.S. Lumber Coalition.

A late-evening statement from the U.S. administration accused companies of benefiting subsidies ranging from three per cent by J.D. Irving Ltd., to 12.82 per cent for Resolute FP Canada, Ltd., to 20.26 per cent for Canfor Corp., to a high of 24.12 per cent for West Fraser Mills, with most others coming in at 19.88 per cent.

Duties will be collected retroactively, too — the U.S. says it will gather them for the previous 90 days. Industry analysts expect the combined duties, Monday’s and the upcoming ones, to range between 30 and 40 per cent.


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