Canada's Trade Minister Slams US Plan To Raise Duties On Canadian Softwood Lumber

A US plan to raise duties on Canadian softwood lumber exports is "entirely unwarranted," International Trade Minister Mary Ng said Thursday.

"Canada is extremely disappointed that the U.S. Department of Commerce has signaled its intention to significantly increase its duties on softwood lumber from Canada from 8.05% to an estimated 13.86%," Ng said in a statement. "This measure is entirely unwarranted."

Ng vowed to fight the increase through CUSMA, the free trade Canada-U.S.-Mexico Agreement, the US Court of International Trade and the World Trade Organization.

The increase is the latest in a long-running see-saw feud that began when the Canada-US softwood agreement expired in 2015 and the US started to impose tariffs two years later.

The Americans insist that Canada subsidizes its softwood lumber producers, while Ng denies the charge and said it is consumers who pay the price for the increase.

"US duties on softwood lumber already unjustifiably harm consumers and producers on both sides of the border," she said in the statement. "Increased duties will further harm the Canadian softwood lumber industry, workers and communities and make housing even less affordable for Americans."

Softwood lumber – fir and pine – is used in the majority of residential construction as well as repair and remodeling. In Canada, most of the softwood comes from Crown lands that are managed by the provinces. In the US, the lumber comes from private land, making the cost higher. The Americans argue that this makes Canadian softwood subsidized.

There is a lot at stake. In 2020, the US imported CAN$8.4 billion ($6.28 billion) in softwood from Canada, according to Natural Resources Canada figures. About 80% of US softwood lumber imports came from Canada. The industry directly employed about 28,000 Canadians in 2020.

The US Department of Commerce review is preliminary the new tariff will not take effect until a final approval this summer. -