US lumber industry presses for import duties to counter Canadian subsidies, dumping

Dive Brief:

U.S. lumber industry leaders are lobbying the U.S. Department of Commerce and the U.S. International Trade Commission to put import duties on Canadian softwood lumber following claims it is being sold in the U.S. below fair market value, Engineering News Record reported.
Imports of Canadian softwood lumber in the first eight months of this year were over 33% higher than in the same period of last year, per a petition put forth by the Committee Overseeing Action for Lumber International Trade Investigations or Negotiations. It comes after a bilateral trade deal between the U.S. and Canada to preside over Canadian lumber exports expired in October 2015.
COALITION said that duties are now required to offset the “harm” caused to U.S. lumber mills by Canadian softwood subsidies and the alleged dumping of that product in the U.S.

Dive Insight:

The latest move by the COALITION, which includes producers Weyerhaeuser and Potlach as well as the Carpenters Industrial Council and the U.S. Lumber Coalition, ENR reported, is set to intensify already strained trade relations between the lumber industry in the U.S. and Canada after the two sides were unable to strike a new softwood lumber agreement over the summer following 100 days of negotiations.

The sticking point in the discussions was that the U.S. wanted to reduce Canada's market share to 22% over a four-year period. The share of Canadian exports to the U.S. have risen to around 34.1% through November 2016 from 29.5% in the third quarter of 2015.

The COALITION believes the tariffs would help to counteract the impact of Canadian producers dumping what it calls “subsidized merchandise” in the U.S. market.

Softwood trade agreements between the U.S. and Canada have led to protracted disputes that homebuilders claim have driven up lumber prices.

This fall, the National Association of Home Builders held talks with public and private interests in Chile over the possibility of boosting the country’s exports of softwood and other lumber products to the U.S. Today, imports from Chile represent roughly 1.22% of the U.S. lumber market. The association is also exploring ways to increase domestic harvesting of lumber.

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