US cuts some tariffs on Canadian lumber imports

By Barry Ellsworth

TRENTON, Canada

The U.S. on Thursday cut tariffs on Canadian softwood lumber but still insists the Canadian government is “providing unfair subsidies” to its producers.

The U.S. Commerce Department decided on the tariff reduction unilaterally because the two countries could not reach a mutually satisfactory deal.

“While I am disappointed that a negotiated agreement could not be made between domestic and Canadian softwood producers, the United States is committed to free, fair and reciprocal trade with Canada,” U.S. Commerce Secretary Wilbur Ross said in a statement on the agency’s website.

“This decision is based on a full and unbiased review of the facts in an open and transparent process that defends American workers and businesses from unfair trade practices.”

The Commerce Department reduced import duties for most Canadian producers to 20.83 percent from 26.75 percent.

In 2016, the U.S. imported an estimated US$5.66 billion worth of softwood lumber from Canada, the Commerce Department said.

The lumber is primarily used in the housing industry.

In a joint statement on Canada’s government website, Foreign Affairs Minister Chrystia Freeland and Minister of Natural Resources Jim Carr called the remaining tariffs “unfair, unwarranted and deeply troubling”.

The lingering lumber dispute has been a thorn in the side of both countries since the early 1980s.

The U.S. insists Canada is unfairly subsidizing softwood lumber producers because in Canada, tracts of timber are owned by the provincial governments, while in the United States, softwood lumber lots are privately owned.

“We urge the U.S. administration to rescind these duties, which harm workers and communities in Canada,” the Freeland-Carr statement said. “These duties are a tax on the American middle-class families, too, whose homes, renovations and repairs will only be more expensive.”

Canada has successfully fought the duties under various trade mechanisms, but the Americans keep coming back periodically to restore tariffs because only temporary agreements have been reached, with no long-term deal.

“We will forcefully defend Canada’s lumber industry, including through litigation, and we expect to prevail as we have in the past,” the Canadian statement read.

“We are reviewing our options, including legal action through the North American Free Trade Agreement and the World Trade Organization, and we will not delay in taking action.”

About 360,000 Canadians were employed in the lumber industry in 2013, Statistics Canada reported.