USA locks in duties on Canada's softwood lumber industry

THE CANADIAN PRESS

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Logs are unloaded at Murray Brothers Lumber Company woodlot in Madawaska, Ontario on Tuesday, April 25, 2017.

The U.S. lumber coalition position is that Canada unfairly subsidizes its producers with low stumpage fees for harvesting trees on government land and that Canadian producers are selling wood into the U.S.at lower prices than they sell it at home. However, the U.S. International Trade Commission did not find critical circumstances in the anti-dumping case, therefore retroactive anti-dumping duties do not apply.

The United States International Trade Commission ruled Thursday that Canadian subsidies of softwood lumber injure the US lumber industry.

In a 4-0 vote Thursday, the agency sided with the USA lumber coalition that it was materially injured by imports from Canada.

About half of Canada's softwood lumber exports to the US originate from British Columbia and the U.S.is British Columbia's largest market for softwood lumber products.

The decision will impose anti-dumping and anti-subsidy duties affecting about $5.66 billion worth of lumber and comes amid increasingly acrimonious talks on renegotiating NAFTA, the trilateral trade pact between the United States, Canada and Mexico.

"The ITC finding of "injury", despite the current record-setting profitability of the US lumber industry, makes it very clear that this was not an objective evaluation of the facts", Yurkovich said. We will initiate appeals as soon as possible and, working with both federal and provincial governments, we are confident that the ITC decision will be overturned.

Senate Finance Committee ranking member Ron WydenRonald (Ron) Lee WydenDemocratic senator predicts Franken will resign Thursday Avalanche of Democratic senators say Franken should resign Lobbying world MORE (D-Ore.) supported ITC's decision.

Last month, Canada filed for the creation of an expert panel under Nafta to determine on whether the duties are justified under law. 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.

In testimony this week before lawmakers, Canada's chief Nafta negotiator, Steve Verheul, said the softwood dispute between the USA and Canada "will continue to be a hard issue" and said it is unlikely a solution will be incorporated in any renegotiated continental trade pact.

The dispute is expected to further add to tensions between the US and Canada, which are in the midst of negotiating, with Mexico, a rewrite of the North American Free Trade Agreement.

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