Proposed Lumber Duties Will Harm Consumers, Housing Affordability

Filed in Economics, Material Costs by on April 25, 2017 11 Comments

NAHB has denounced the decision by the U.S. Department of Commerce to impose a 20% countervailing duty on Canadian lumber imports, saying it will harm American home buyers, consumers and businesses while failing to resolve the underlying trade dispute between the two nations.

“NAHB is deeply disappointed in this short-sighted action by the U.S. Department of Commerce that will ultimately do nothing to resolve issues causing the U.S.-Canadian lumber trade dispute but will negatively harm American consumers and housing affordability,” said NAHB Chairman Granger MacDonald.

NAHB has been closing monitoring the situation regarding U.S.-Canadian lumber trade since the Softwood Lumber Agreement between the two nations expired on Oct. 12, 2015. There was a one-year cooling off period where neither country was allowed to engage in litigation on the issue that expired last October.

In the past year, we have kept our members up-to-date on association actions and events regarding the lumber trade dispute as noted in these past blog posts, many of which also ran in previous issues of the Monday Morning Briefing:

NAHB has also worked aggressively to get our message out to the media. Forty-eight hours after the Commerce Department announced the new lumber tariffs, The Hill and Fortune published editorials by NAHB Chairman Granger MacDonald condemning this short-sighted policy that will hurt American home builders, home buyers and lumber consumers.

Canadian Imports are Essential

Thirty-three percent of the lumber used in the U.S. last year was imported. The bulk of the imported lumber — more than 95% — came from Canada.

“This means that imports are essential for the construction of affordable new homes and to make improvements on existing homes,” said MacDonald.

The trade agreement that has governed Canadian imports of softwood lumber since 2006 effectively expired at the end of 2016. Uncertainty surrounding a new trade pact is the primary catalyst for the 22% spike in the Random Lengths Composite Price Index for lumber since the beginning of the year.

These price hikes have negative repercussions for millions of Americans. It takes about 15,000 board feet to build a typical single-family home and the lumber price increase in the first quarter of this year has added almost $3,600 to the price of  a new home.

To truly put the interests of America first as it relates to this trade issue, NAHB believes the U.S. and Canada need to work cooperatively to achieve a long-term, stable solution in lumber trade. This is essential because tariffs needlessly increase the volatility of the lumber markets, resulting in higher prices for U.S. home buyers and other lumber consumers.

Since the U.S. does not produce enough lumber to meet the nation’s demand, NAHB remains committed to first and foremost, exhausting all domestic opportunities. This includes pursuing better multi-use forest management practices, reducing U.S. lumber exports overseas, and opening up additional federal forest lands for logging in an environmentally sustainable manner.

Further, U.S. trade negotiators need to recognize that in every previous countervailing lumber duty case brought against Canada, it was ultimately determined that that the Canadian government did not provide unfair subsidies to its lumber industry.

And it’s not just home buyers and everyday people who are hurt by tariffs. According to the Bureau of Labor Statistics, in 2016 housing and related industries that used softwood lumber employed nearly 4.5 million American workers and outnumbered U.S. lumber-producing workers by 31 to 1.

“Venturing once more down this broken protectionist path will only enrich the special interests of lumber mills and big landowners,” said MacDonald. “It’s time to consider our national interest and cut a fair deal for U.S. home buyers, consumers and businesses who use lumber.”

For more information, contact Felicia Watson at 800-368-5242 x8229 or Alex Strong at x8279.


Comments (11)

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  1. Brice T says:

    How bout we increase our own production of softwoods and lessen our dependence on other countries. All the while creating more jobs and opportunity for our own citizens. Just because its cheaper doesnt mean that it is good for our economy. Whether it be losing jobs to Mexico, China, or even Canada, the problem is that we are suffocating industry in our country.

    • Bill S. says:

      Because the conservationists that control the conversations in our media would blow their ever love’n minds at the thought of destroying our environment and increasing greenhouse gas here in America by reducing percentage of trees! Even thought the same amount of trees are going to be cut down somewhere else and then driven here causing an even greater amount of carbon into the atmosphere! But it’s all in the optics!

    • Steve Carroll says:

      According to the above article the US supplies 66% of our need for building lumber. I’d say that’s a plenty. Fair trade between countries is a good thing. Our current US President, which this organization supported, has only proposed short-sighted policy changes.

    • Peter Berube says:

      it’s the same old BS. the government does not care. the end user gets to foot the bill as usual !. there is plenty of lumber to harvest but tooo many regulations. just like gas one day we have an entire years supply, could give it away. next week price goes up for (summer blend) $.40 a gallon? Wall street. Glad i’m 61 and not 21. 40 years and almost had enough with all the regs and permitting.

  2. Canadians consume a huge amount of US goods. Softwood lumber from Maine is exported daily. Hardwoods from Pennsylvania, West Virginia, Ohio and Michigan daily exports to Canada and the world.
    The 20% tariff on Canadian lumber is counterproductive for the American Dream of Homeownership. The dream that help make America Great.
    Steel studs were substituted last time we had to fight this issue.
    The biggest lumber producers in North America are in the 🇺🇸 USA with operations in Canada 🇨🇦 and Mexico 🇲🇽.
    I see restraint of trade and restraint of competition.

  3. Scott Easton says:

    Canadian lumber companies are allowed to harvest on Crown Land (Government Land) almost entirely free of charge. How is allowing Canada the ability to dump a heavily government subsidized product on the American market productive to the American Dream?

  4. Gene Raley says:

    Every year, millions of board feet of lumber goes up in flames because of poor management of the resource. How wasteful of this country to allow a resource to burn rather than harvest it and use it for the purpose of housing. Unless conservationist live in tent and caves, their selfishness is allowing a resource and and industry to stagnate and die. Shame on them.

  5. Tom Corrigan says:

    One truly sad result of the SLA is the affect on western red cedar users. The USA has no red cedar industry to protect. Virtually every western red cedar deck board, 4×4, and 6×6 comes from Canada. Every deck and fence builder will be severely impacted by the tariff because they have no American alternative and since the tariff is applied on a percentage basis and red cedar is the most expensive import, they are the hardest hit. Red cedar is the dolphin being caught in the tune net.

  6. walter bruce says:

    IT is amazing how much wood and board feet are wasted each year. we can’t harvest wood here without a fight with the “tree huggers”, we can’t produce or drill oil, which we have plenty of, and on and on. So long as we harvest our natural resources, and where applicable replant, restore, the environment/earth to regenerate, then what are we doing? we are simply selling ourselves to other countries and being more and more dependant on them. well I am my family will not be dependant on any other country or anyone else. I have and always will work and provide for my family. Try taking it away.

  7. our association needs to be more carefull in deciding who to endorse for president
    this candian lumber duty imposed by trump is a disaster

  8. Mike hochgesang says:

    It is amazing but not one comment mentions the cause of the tariff. Canada has slapped a huge tariff on Wisconsin dairy products causing farmers to lose money and causing some to go broke.

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