Softwood lumber: Minister was not notified of tariff hike

Softwood lumber: Minister was not notified of tariff hike
Softwood lumber: Minister was not notified of tariff hike

Mary Ng said in a House of Commons committee hearing that U.S. Trade Representative Katherine Tai did not mention the possibility at Free Trade Commission meetings last month.

The preliminary increase in softwood lumber tariffs by the US Department of Commerce to 18.32%, from the previous level of 8.99%, appeared three days later.

Since this is a preliminary tariff rate, the current cash deposit rates continue to apply until the finalized rates are released, likely in November.

The increase came as lumber prices in North America hit new highs in May, fueled in large part by strong demand for homeowners during the pandemic.

Those prices steadily declined in June, in part because vaccination and waning fears about COVID-19 helped reduce demand.

At Friday’s meeting of the House of Commons International Trade Committee, Conservative MP Tracy Gray asked Ms Ng if the U.S. Rep had mentioned the upcoming increase when the two met virtually in free meetings. -exchange on May 18.

No she didn’t, replied the Minister of International Trade.

When Ms. Gray asked her why she hadn’t picked up the phone later to discuss tariffs with Ms. Tai, Ms. Ng hesitated.

I stand up for the Canadian softwood forestry sector and lumber workers and companies as a top priority, she said. It is a very important sector that employs many, many Canadians, and it is my commitment to always defend their interests.

Ms Ng’s responses barely deviated from that theme throughout her hour-long appearance except when she referred to recent public comments by Commerce Secretary Gina Raimondo.

Ms. Raimondo said at a Senate committee hearing last week that the price of lumber could be a boost to the final resolution of a dispute that has plagued Canada-U.S. Relations for decades.

The silver lining could be that we take the opportunity to get all of us around the table, including (the Trade Representative), to find a long-term solution with Canada.Ms Raimondo said at the May 26 hearing.

It’s encouragingsaid Ms Ng. Our job here is to make sure that we stand up for the interests of our businesses and the industry against this overhaul and against the tariffs that have been applied.

Heavily subsidized

The US lumber industry says Canadian products are heavily subsidized, because of stumpage fees deemed too low.

The Trump administration attempted to impose a 20% tariff on softwood lumber in 2017, but that effort was scuttled after the World Trade Organization sided with Canada last year .

Arun Alexander, director general of the Department of Foreign Affairs’ North American trade policy office, argued that tariffs on lumber on Canadian imports only served to make homes and more expensive renovations in the US.

The average cost of a middle class home in the United States (…) increased from $ 35,000 to $ 40,000 due to tariffssaid Alexander, citing data from the National Association of Homebuilders, established in the United States.

In the case of multi-purpose housing, which makes up the bulk of affordable housing in the United States, the increase was about $ 19,000, he added.

The association, said Mr. Alexander, argues very vehemently that tariffs on Canadian lumber have a significant impact on the price of housing in the United States, especially in light of the recovery and for affordable housing.

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