Published: Wed, June 28, 2017
Sci-tech | By Jackie Newman

Anti-Dumping Duties Imposed

Anti-Dumping Duties Imposed

Analyst Paul Quinn of RBC Capital Markets believes the USA will play hardball and impose high anti-dumping rates in order to push Canada to agree to a deal before negotiations on NAFTA begin in August. "A final decision on the matter is expected by late summer".

"We applaud the Department of Commerce's decision to take further action against Canada's unfair trading practices and restore fair trade for U.S. lumber producers, ' said U.S. Lumber Coalition spokesperson, Zoltan van Heyningen". That represented a $165-million loss in exports for the month, including $105 million in B.C. and $18 million in Quebec.

The department will instruct U.S. Customs and Border Protection (CBP) to collect cash deposits from importers of softwood lumber from Canada based on these preliminary rates. It set a preliminary dumping rate of 6.87% for all other producers in Canada.

"The ongoing allegations levelled by the USA industry are without merit", Yurkovich said.

The two cabinet ministers said the penalties are based on a "flawed rationale that is damaging to workers, communities and consumers in Canada and the United States" and that Canada will "vigorously defend" the forest industry through litigation. "With the USA housing sector regaining its footing, imposing arbitrary protectionist restrictions to subsidize domestic lumber producers will blunt this forward momentum and make homeownership more expensive for hard-working families", he warned. "The numbers matter a little bit less than just the fact that this is something that's happening under Trump and it's happening ahead of NAFTA, that political activity is as important if not more important than how this will actually impact the lumber industry when it comes to the goals of this administration".

When combined the duty rates range from 17.41 percent to 30.88 percent.

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"We've had very good support from the federal government and the provincial government on this file", said trade council president Susan Yurkovich.

"We find it incredibly frustrating the USA industry continues to use litigation as a means to enhance their position and benefit from price volatility that their trade actions create", Yurkovich said on a conference call with reporters.

Canada supplies about a third of the lumber needed in the U.S. The previous settlement took more than four years to negotiate.

The duty is to counter subsidies from the Canadian government the USA lumber industry insists is giving Canadian forestry companies an unfair advantage because lumber is taken from government owned lands.

Results of a final investigation is expected in September to determine if the tariffs are permanent, the release noted.

After the countervailing duties were announced, Resolute said it would cut shifts at seven sawmills and delay the start of forest operations that will affect 1,282 workers.

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