Trump Administration Seeks 20% Tariff on Canadian Lumber

According to the Wall Street Journal on Monday evening:

“The Trump administration is taking retaliatory action against Canada over a trade dispute, moving to impose a 20% tariff on softwood lumber that is typically used to build single-family homes.

In an interview Monday, Commerce Secretary Wilbur Ross said the tariff will be applied retroactively and imposed on Canadian exports to the U.S. of about $5 billion a year. He said the dispute centers on Canadian provinces that have been allegedly allowing loggers to cut down trees at reduced rates and sell them at low prices.”

Tomorrow, the Department of Commerce (DOC) is anticipated to release its official preliminary findings regarding its investigation into whether Canada subsidizes lumber exported into the U.S. So it remains to be seen whether 20 percent is a round number or an actual figure.  Again, that determination is preliminary, but once issued, duties will be collected on imported lumber shortly thereafter.

Another item of note is the DOC’s investigation into the charge that in anticipation of trade sanctions, Canadian companies have ramped up (or “surged”) their exports to the U.S. In the case where “critical circumstances” indicated a surge, the duties would be imposed retroactively back 90 days.  Through its investigation, the DOC states in a document released today:

“Based on the criteria and findings discussed [in this document], we preliminarily determine that critical circumstances exist with respect to imports of softwood lumber shipped by J.D. Irving and ‘all others.’ We preliminarily determine that critical circumstances do not exist with respect to Canfor, Resolute, Tolko and West Fraser.”

This appears to indicate that imposed duties would be retroactive on all Canadian lumber exporters except the four named companies.

Finally, it’s interesting to note the WSJ article indicates the U.S. Lumber Coalition, which petitioned for these trade sanctions, has already reacted:

“Cameron Krauss, senior vice president of legal affairs at the U.S. Lumber Coalition said, “We appreciate today’s actions by the Department of Commerce.” The group represents large and small American lumber producers.”

SBCA will continue to monitor and report on this issue as additional facts are made available so that the best possible decisions can be made. SBCA will also be taking actions to minimize, to the greatest extent possible, the negative effects of this dispute on our membership.

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