The U.S. Lumber Coalition said it is in agreement with the U.S. Department of Commerce’s latest “Administrative Review” regarding Canadian softwood lumber.
In its review, the Department of Commerce reported that Canadian softwood lumber is “heavily subsidized” and dumped into the U.S. market. The review includes the issuing of a combined anti-subsidy and anti-dumping duty rate of 8.99%. Previous rates surpassed 20% in some instances.
“While the U.S. Lumber Coalition has demonstrated that this calculation understates true levels of subsidies and dumping, these results nonetheless reinforce that the Canadian lumber industry benefits from significant government subsidies and dumps lumber into the U.S. market at unfairly low prices,” Zoltan van Heyningen, executive director of the U.S. Lumber Coalition said in a prepared statement.
In response to the Department of Commerce’s findings in its administrative review, the British Columbia Lumber Trade Council said the reduction in duty rates is “a step in the right direction” while affirming the belief that paying duties on lumber products sold to the U.S. market “is both frustrating and disappointing.
“As we have consistently said, and as has been proven in previous rounds of litigation, the Canadian industry is not subsidized, and this trade action levels by U.S. producers is completely without merit,” Susan Yurkovich, president of the BC Lumber Trade Council, said in a statement released by the organization.
The Commerce Department initiated its second administrative review in March 2020, covering Canadian lumber imports in 2019. A preliminary determination for the second administrative review is expected in late January 2021.
Van Heynigen said the a World Trade Organization (WTO) dispute settlement panel report from earlier in 2020 had a “negative impact on the countervailing duty rate” for the Commerce Department’s first administrative review. In August, the WTO determined that duties put in place to help balance Canadian subsidies by the United States were in violation of global trading rules. The WTO said the United States had not provided enough evidence that prices paid by Canadian firms for timber were artificially low. The U.S. appealed the decision, with U.S. Trade Representative Robert Lighthizer calling the WTO’s ruling “flawed.” Van Heyningen said it is “imperative” the WTO recommendations “are not allowed to undermine in any way the continued enforcement of the trade laws.”
