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Texas Agriculture Archive

May 17, 2002

Lumber:
ITC rules against Canada

The U.S. International Trade Commission (ITC) ruled in early May that imports of softwood lumber from Canada threaten to cause harm to the U.S. softwood lumber industry, and assessed combined antidumping and countervailing duties of 27 percent on imports from all but the Canadian maritime provinces. The duties will begin to be collected as soon as the order can be formally prepared and delivered to the U.S. Customs Service.

The ITC did, however, dismiss earlier findings of "critical circumstances" (which result from a surge in imports of 15 percent or more) and ordered the return of approximately $760 million in duties collected on Canadian softwood exported to the U.S. since the preliminary findings were issued several months ago.

Both the Canadian government and U.S. homebuilding interests soundly criticized the decision.

Canada has already appealed earlier decisions to the WTO and NAFTA, claiming the U.S. is overly protective of its market and arguing that the U.S. methodology to arrive at trade dispute decisions is flawed. U.S. home-builders charge that home construction costs will increase by $1,000 to $1,500 per house to pay for the new tax.

Negotiations ended a few weeks ago when talks broke down and the U.S. lumber industry is eager to return to the negotiating table. Farm Bureau supported continuation of the U.S.-Canada Softwood Lumber Agreement, a five year agreement that expired on March 31, 2001. Absent the agreement, Farm Bureau believes that U.S. trade laws must be allowed to function until a long-term, durable solution is negotiated.