U.S. Doubles Duty on Canadian Softwood Lumber

Trade Update • August 14, 2024

he U.S. Department of Commerce has announced a substantial increase in duties on Canadian softwood lumber imports, almost doubling the rate from 8.05% to 14.54%.

Canada’s Objections

The Honourable Mary Ng, Minister of Export Promotion, International Trade and Economic Development, issued the following statement on the final results of the U.S. Department of Commerce’s fifth administrative review of anti-dumping and countervailing duties on certain Canadian softwood lumber products:

“Canada is extremely disappointed that the U.S. Department of Commerce has significantly increased its unfair and unwarranted duties on softwood lumber from Canada, from 8.05% to 14.54%.

“Baseless and unfair U.S. duties on softwood lumber unjustifiably harm consumers and producers on both sides of the border. This latest measure will negatively impact workers and their communities. U.S. consumers and businesses that need Canadian lumber will bear the burden of these duties, making housing even less affordable for Americans.

“It is in the best interests of both Canada and the United States to find a lasting resolution to this long-standing dispute. We will always fight for the best interest of Canadians and continue to use all available avenues to vigorously defend the workers, businesses, and communities who rely on softwood lumber for their livelihoods. These include litigation under NAFTA and the Canada-United States-Mexico Agreement, at the U.S. Court of International Trade and at the WTO.”

History

The U.S. continues on in wanting Canada to address the provincial stumpage fee regime that, according to American producers, gives Canadian producers an unfair advantage. The dispute over softwood lumber dates back to 1982 and is rooted in a disagreement between the two countries over how much American companies should pay for timber cut from public lands in Canada. The U.S. believes that Canadian companies do not face market prices as they can access timber at below-market prices through government subsidies or provincial pricing policies and then export it to the U.S. at lower costs than domestic producers. Meanwhile, Canadian producers denied those claims and argued that their timber is harvested sustainably and sold fairly on world markets.

Quick Facts

• The U.S. Department of Commerce (Commerce) conducts a yearly review of its anti-dumping (AD) and countervailing duty (CVD) orders.
• Commerce initiated the fifth administrative reviews of its softwood lumber AD and CVD duty orders on March 14, 2023. It issued the preliminary results of these reviews on February 1, 2024.
• Commerce issued its final results on August 13, 2024. The new combined duty rate that will apply to most softwood lumber exports is 14.54% compared to the previous rate of 8.05% from the fourth administrative reviews.
• The new rate will be applied retroactively to exports made in 2022 and will apply to new exports of softwood lumber products to the United States from companies that were subject to the fifth administrative reviews.

Questions about Canada’s softwood lumber exports into the U.S. and these continued duties please contact us. We’re here to help.