US broadens net against Canadian softwood imports
By Peter Ewart
The US International Trade Administration (USITA) has expanded its net to include a number of value-added Canadian softwood products it will be investigating for so-called “unfair trade practices.” This follows an announcement last week by USITA that Canada, with its softwood exports, has caused “injury” to US producers (1).
As Madison’s Lumber Reporter notes, the original intent of US anti-dumping duties (ADD) and Countervailing Duties (CVD) was to apply these to “primary mills” only and not to downstream industries that further process or fabricate the wood, e.g. value-added products (2).
However, over the years, the US Lumber Coalition has continually pushed to expand the net. For example, it argued for drilled and/or notched studs to be included. This was “quickly expanded to include all drilled and/or notched lumber, as well as angle end-cut material, none of which required further fabrication after import.”
Now the USITA is demanding that a range of new products must also be covered by the net, including various types of “wood pallet and packaging, door and window frame, and fencing material” not requiring further fabrication (2).
The Madison’s Lumber Report concludes that, if the US Lumber Coalition and the USITA are “allowed to continue to increase the scope, pretty soon all lumber products from Canada, will be captured”, i.e. possibly subject to anti-dumping duties and countervailing duties.
This development poses a serious danger to Canadian value-added and downstream softwood producers, many of which are small or medium in size. And it is another example of how the US promotes “free trade” one day and “protectionism” the next, according to whatever suits its purposes – everyone else, including Canada, be damned. All of this underscores the danger of basing a large part of our economy on trade with a domineering and, increasingly fickle and erratic, US oligarchy.
Indeed, all of this may be a move to suffocate and restrict Canadian wood manufacturing right at a time when science and technology has opened up great possibilities for obtaining more value out of wood in the form of new products, processes and usages.
Above all, it underscores the necessity for our own province and nation building strategy utilizing our wealth of natural resources as a basis for an all-sided national economy. Otherwise, the direction we are heading in is to be reduced to “a hewer of wood and drawer of water” for the US oligarchs.
Peter Ewart is a columnist and writer based in Prince George, British Columbia. He can be reached at: peter.ewart@shaw.ca
- Macdonald – Meisner, Elaine. Softwood Lumber battle heating up. January 6, 2017. 250 News. https://www.250news.com/2017/01/06/softwood-lumber-battle-heating-up/
- Madison’s Lumber Reporter. January 8, 2017. ITC Softwood Lumber ADD/CVD Fact Sheet. http://madisonsreport.com/lumber-prices/
Comments
The US is now entering a phase of extreme protectionism. With Trump in the White House doing everything he can to protect US workers and a Republican controlled senate they’ll be tough to deal with going forward.
Buckle up. It’s going to get stupid. The first thing the Republicans did was to try and gut the ethics department. They’ll try to restrict the EPA and they’ll try and push their overly religious mandate through the lawmakers for the next four years.
Dumpster fire indeed.
Mercenary, direct and to the point… it was an absolute pleasure reading your comment!
The US government has an “Ethics Department”??? That’s a new one.
What “overly religious mandate”? Trump said his favourite book is the Bible but he couldn’t quote a single verse when asked. I doubt he’s ever even opened one. Obama’s more religious than Trump.
If the USA claims that softwood lumber imported from Canada is lumber that is being ‘subsidised’, would it not then be logical for the USA to say that SAME lumber, manufactured into so-called ‘value-added’ products here, was also ‘subsidised’?
After all, it could be said it came from the same source, the same Crown timber that’s priced in a manner that the US sees as constituting a ‘subsidy’, is it not? What’s the difference? Just because it’s ‘notched’, or ‘angle cut’, or ‘drilled’ for an electrical wire to pass through it, or even, to take it further, made into a finished product, like a pallet or a wooden window frame, it’s still made out of that ‘subsidised’ lumber.
What this really points out is that ANY country that will not modify its financial system so that it doesn’t HAVE TO export more than it imports is a country that’s deluding itself in regards to the ongoing economic security of its citizens. The US, in this regard, still has a singular advantage over all other countries. Its currency is the world reserve currency. It supplanted gold in that role decades ago, and despite what various ‘gold bugs’ wish, there’s no going back to what once was. Mainly because THAT didn’t work, either. Nor could it ever be made to.
One argument our negotiators are already using is that if Canadian lumber is hit with a duty the rise in price to US homebuilders will “price American new home buyers out of the market.”
Do they ever stop and consider that the price of the TOTAL lumber content in the average modern house adds up to LESS than the real estate commission a realty company gets for selling that house?
The price of lumber, like those of agricultural products, and many, if not most, other ‘hard’ commodities, has never kept pace with inflation. That’s the main reason why, year after year after year, there’s a continual decrease in the number of producers. The ‘big’ get bigger, not as some assume, because they’re ‘greedy’, but simply as a matter of survival. For awhile longer.
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