Softwoods are pictured along the Fraser River in Richmond, British Columbia, Tuesday, April 25, 2017. JONATHAN HAYWARD/The Canadian Press
The U.S. Commerce Department has halved tariffs against most Canadian softwood lumber producers, but the long-running trade dispute continues as Canada plans to appeal the decision to keep the punitive tariffs in place.
After an administrative review, the Commerce Department said Thursday it would cut the tariff rate for most Canadian lumber producers to 8.59 percent, down from the current 17.91 percent.
The Commerce Department announced its intentions in January to cut tariffs, proposing a preliminary tariff rate of 11.64 percent, and has now reduced that amount further with a final rate of 8.59 percent.
International Trade Minister Mary Ng said the US tariffs on Canadian lumber are unjustified and unfair.
“These tariffs have caused undue harm to Canadian industry and its workers. They also represent a tax on US consumers, exacerbating housing affordability at a time of heightened supply challenges and inflationary pressures,” she said in a statement.
Ms. Ng said Canada plans to oppose the latest tariff rates, including by filing a challenge through a dispute settlement process under Chapter 10 of the Canada-US-Mexico Agreement.
The new rates are expected to take effect on or after August 10.
Under the new tariff schedule, Vancouver-based Canfor Corp. will see the customs rate drop to 5.87 percent, down from the current 19.54 percent.
Vancouver-based West Fraser Timber Co. Ltd. will pay a rate of 8.25 percent, compared to 11.14 percent, while Montreal-based Resolute Forest Products Ltd.’s new rate. will be 14.86 percent, down from the current 29.66 percent cents
The interest rate of St. John’s-based JD Irving Ltd. will be 7.17% compared to 15.05% today.
The 2006 Canada-US Softwood Lumber Agreement expired in October 2015 without a replacement. In the latest round of the trade dispute, Canadian producers have been paying tariffs on US lumber since April 2017.
“While the reduction in tariff rates from this third administrative review is welcome, the fact that we are required to continue to pay duties on our timber products sold in the US market remains disappointing and disappointing,” said the president of BC Lumber Trade Council Susan Yurkovich in a news release. “As U.S. manufacturers continue to be unable to meet domestic demand, these tariffs continue to hamper the post-pandemic recovery and exacerbate inflationary pressures on both sides of the border.”
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