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Canadian Softwood Lumber Hit with Second Wave of Duties

Posted June 27, 2017

Late yesterday, the U.S. Department of Commerce announced the affirmative preliminary determination in the anti-dumping duty investigation of softwood lumber from Canada.

To the surprise of no one, Commerce found that Canadian exporters were dumping softwood lumber in the United States, with the specific rates based on the evidence provided being determined at the range of between 4.59% to 7.72% less than fair market value.

U.S. Customs will accordingly now be instructed to collect cash deposits from importers of Canadian softwood lumber based on these preliminary rates.

It should be noted that the latest anti-dumping rates are in addition to the preliminary countervailing duty (CVD) rates that the Commerce Department assessed on April 24, 2017. When combined, the applicable duty rates on Canadian softwood lumber now range from to 17.41% to 30.88%.

In terms of next steps, according to the statement issued by Commerce, it is currently scheduled to announce its final AD determination on September 7, 2017. At the same time, the U.S. International Trade Commission is conducting a parallel investigation to determine whether American producers have been materially harmed by unfairly subsidized and/or below-market value softwood lumber imports from Canada.

In the event of affirmative determinations in both investigations, then Commerce will issue an anti-dumping order. However, in the extremely unlikely event the ITC does not find that U.S. producers have actually been harmed by Canadian imports, the investigation will draw to a close without any duties being collected and the cash deposits will be refunded.

Despite Commerce Secretary Wilbur Ross often claiming that the United States is the least protectionist country in the world, the statement concludes by proudly boasting that his department has so far this year initiated 49 anti-dumping and countervailing duty investigations and notes that Commerce currently maintains over 400 such trade remedy orders.