Commerce Proposes to Cut Canadian Lumber Duties in Half - 6/7/2004 - International Real Estate

Commerce Proposes to Cut Canadian Lumber Duties in Half, But Builders Want Them Eliminated

“The Commerce ruling to reduce punitive duties on Canadian lumber shipments from 27.2% to 13.2% shows that even the U.S. government is finding it increasingly difficult to justify complaints from domestic producers that Canadian lumber is subsidized,” said NAHB President Bobby Rayburn.

A North American Free Trade Agreement (NAFTA) panel recently determined for a second time that the U.S. lumber industry’s allegations that it is threatened by Canadian trade practices are baseless and contrary to law, Rayburn noted. Under U.S. law, if that decision is upheld, the Administration will have no alternative but to eliminate the duties altogether.

“It’s high time to end the duties on Canadian lumber and end the hidden tax imposed on American home buyers and renters,” said Rayburn. “We call on the Administration not to engage in any legal delays and to allow the implementation of the NAFTA decision.”

The U.S. International Trade Commission has until June 10 to respond to the NAFTA panel.

After accepting complaints from U.S. lumber producers that they could be harmed by Canadian lumber imports, the Commerce Department in May of 2002 imposed countervailing and anti-dumping duties averaging 27% on Canadian softwood lumber shipments into the U.S.

The June 3 proposal by the Commerce Department to cut the levies came after U.S. trade officials changed how they calculate prices and duties. The final rate, which can be appealed, will be determined after Commerce completes its final administrative review in December.

Due to tariffs and strong demand for wood in the U.S. and overseas, the cost of framing lumber averaged more than $450 per 1,000 board feet last month, up 40% from the beginning of the year and its highest level since July of 1999, according to the authoritative trade publication, Random Lengths, which is based in Eugene, OR.