Increase in US customs duties on softwood lumber ‘totally unjustified,’ says Commerce Minister

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The federal government has attacked the U.S. Department of Commerce over its plan to increase tariffs on Canadian softwood lumber.

International Trade Minister Mary Ng said the United States has announced plans to raise tariffs to 13.86 percent from 8.05 percent previously.

Ng calls the decision disappointing and completely unjustified.

It’s the latest salvo in a bilateral exchange that Ottawa has described as a drag on efforts to improve the cost and supply of housing.

Last month, Ng vowed to challenge the U.S. International Trade Commission’s decision to keep the tariffs in place.

She says Canada will fight these rights by every means available, including through litigation under existing trade agreements, as well as before the World Trade Organization and the United States Court of International Trade.

WATCH | Canada challenges ‘unjustified and unfair’ US duties on softwood lumber:

Canada officially challenges ‘unfair’ US tariffs on softwood lumber

Canada formally launches challenge to what it considers “unjustified and unfair” U.S. duties on Canadian softwood lumber under the dispute settlement system of the U.S. trade deal, the Mexico and Canada.

Canada is “extremely disappointed” by the Commerce Department’s latest findings, Ng said. “This measure is completely unjustified.”

At the same time, she added, the federal government is ready to negotiate a solution to the dispute that has marred Canadian-American relations for decades.

“We will continue to work closely with provinces, territories and industry to advance Canadian interests through all available channels,” said Mr. Ng.

“We remain ready and willing to work with the United States to find a negotiated solution that allows a return to predictable cross-border trade in softwood lumber.”

Under the U.S. Tariff Act, the Department of Commerce determines whether goods are being sold for less than fair value or are receiving subsidies from foreign governments.

In Canada, timber-producing provinces set stumpage fees for timber harvested on Crown land, a system that American producers – forced to pay market rates – view as an unfair subsidy.

Freshly cut wood is shown stacked in a factory.
Freshly cut lumber is pictured stacked at a mill along the Stave River in Maple Ridge, British Columbia, April 25, 2019. (Jonathan Hayward/The Canadian Press)

Homework ‘harms Canadians and Americans alike,’ says B.C.

The British Columbia government issued a similar statement Thursday, saying the Commerce Department’s decision was “deeply disappointing.”

“The continued application of unjustified tariffs on softwood lumber exports from British Columbia to the United States is harming Canadians and Americans,” says the joint statement attributed to Forestry Minister Bruce Ralston, in Employment Minister Brenda Bailey and several other officials.

“As we work with our industry partners to develop a reliable and sustainable forestry industry in British Columbia, we are continually hampered by these tariffs, leading to higher prices and unstable markets on both sides of the border.”

A white man in a purple coat speaks in front of a window.
British Columbia Forestry Minister Bruce Ralston speaks in Vancouver on August 10, 2023. (Ben Nelms/CBC)

BC Lumber Trade Council vice-president Kurt Niquidet also responded to the potential tariff increase, saying the Ministry of Commerce “has deviated from some long-standing methodologies at the request of the industry American”.

“While these rates are not yet finalized, they continue to distort the reality that producers in British Columbia and Canada are not subsidized and are not dumping into the U.S. market,” the statement said.

He says the tariffs increase the cost of lumber and building materials south of the border, “at a time when the shortage of affordable housing is having a serious impact on families across the country.”

In October, Canada welcomed a NAFTA dispute settlement panel’s ruling that aspects of how the United States calculates tariffs were inconsistent with federal law.

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