Short-Term Window in Collecting Canadian Lumber Duties Could Boost Market

Filed in Economics by on August 17, 2017 1 Comment

This post was updated Sept. 7 to reflect a delay in determining final duties on Canadian lumber.

In what could be a positive development in the ongoing U.S.-Canadian lumber dispute, countervailing duties on Canadian lumber shipments into the U.S. will be temporarily suspended between Aug. 26 and Sept. 6.

futures for lumberWhile no one can predict with any certainty how this will affect prices, the lumber futures market is anticipating that this development could temporarily moderate the cost of lumber.

As background, the Commerce Department on April 28 imposed preliminary countervailing duties (CVD) on Canadian lumber imports into the U.S. averaging 19.88% and levied an additional anti-dumping duty in June averaging 6.87%.

Under World Trade Organization rules, the CVD cash deposits are collected for four months, which would go through Aug. 25. The final CVD determination was scheduled for Sept. 6, but the Commerce Department announced a delay in determining final CVD and anti-dumping duties on Canadian softwood lumber until Nov. 14 in order to allow more time for the two nations to reach a long-term agreement to settle the trade dispute. The postponement means there will be no CVD cash deposits collected from Canadian lumber firms until a final determination is made. However, anti-dumping duties will continue to be collected under World Trade Organization rules.

The temporary suspension of the collection of CVD duties on Canadian lumber shipments into the U.S. is a positive factor in setting lumber prices. However, many facets determine the cost of lumber. For example, recent wildfires in Canada have adversely affected the supply coming into the U.S. while wet weather has dampened demand.

The U.S.-Canada lumber trade dispute is now tied up in broader renegotiations of the North American Free Trade Agreement (NAFTA). The NAFTA talks could go on well into next year.

NAHB supports trade policies that allow access to the highest quality building materials, at a stable and predictable price.

We continue to work with U.S. Commerce Secretary Wilbur Ross to find an equitable solution that will protect home builders and American lumber consumers from the cost of unnecessary trade restrictions.

For additional information, contact David Logan at 202-266-8448.

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  1. Rick Quinn says:

    How much Us-grown-and-cut timber is shipped across the Canadian border to be milled and then shipped back with a tariff?

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