Sharp Rise in U.S. Duties on Canadian Softwood Lumber

The U.S. Department of Commerce has announced the final results of its fifth administrative review of anti-dumping and countervailing duties on certain Canadian softwood lumber products, significantly raising the combined duty rate to 14.54%, according to reporting from Stockhouse.

This marks a substantial increase from the previous rate of 8.05%, applied in the fourth review, reflecting heightened concerns over what the U.S. government describes as Canada’s “continued subsidization and dumping of softwood lumber products into the U.S. market.”

The U.S. government has long accused Canada of engaging in unfair trade practices, asserting that Canadian softwood lumber products are subsidized by the Canadian government and then sold in the U.S. at less than fair value. These practices, according to U.S. officials, distort the U.S. softwood lumber market to the detriment of U.S. sawmills, their employees and local communities.

The latest review by the Commerce Department has confirmed increased levels of what it describes as “unfair trade,” suggesting that these practices are exacerbating existing market challenges. With lumber prices at extreme lows, the U.S. sawmill industry is facing severe pressure, leading to mill closures and layoffs. The U.S. lumber industry, which has long fought for the imposition of anti-dumping and countervailing duties to combat these challenges, views the Commerce Department’s decision as a necessary measure to protect domestic jobs and businesses.

In a statement, the U.S. Lumber Coalition, representing the interests of U.S. lumber producers, expressed strong support for the continued enforcement of U.S. trade laws. “This even higher level of unfair trade by Canada could not have come at a worse time for domestic producers,” Andrew Miller, chairman of the U.S. Lumber Coalition and CEO of Stimson Lumber said.

“Lumber demand and prices are at record lows and mills across the country are struggling to keep afloat,” he added.

In response to the U.S. decision, Canada’s minister of export promotion, international trade and economic development, Mary Ng, expressed deep disappointment.

The new combined duty rate will apply retroactively to exports made in 2022 and will impact new exports of softwood lumber products to the United States from companies subject to the fifth administrative reviews.

“Canada is extremely disappointed that the U.S. Department of Commerce has significantly increased its unfair and unwarranted duties on softwood lumber from Canada,” Ng said in the Canadian government’s release. She criticized the U.S. measures as “baseless and unfair,” arguing that they unjustifiably harm consumers and producers on both sides of the border.

See the full story from Stockhouse here.