Housing shortage a reason to end softwood lumber fight: feds

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Federal Trade Minister Mary Ng says a housing shortage in both Canada and the United States is only being inflamed further by a prolonged softwood standoff.

The minister’s comments come amid the latest move by Canada in attempts to end softwood lumber tariffs from being collected from Canadian lumber producers at the U.S. border.

Canada has now filed a notice of intent to challenge the United States International Trade Commission’s decision to maintain duties on Canadian softwood lumber products, using Chapter 10 of the Canada-United States-Mexico Agreement trade agreement to do so.

The commission ruled late last month that it has no plans to rescind the existing combined countervailing and antidumping duties totaling roughly eight per cent on softwood crossing over the border.

Brunswick News reported in November that $6.2 billion in tariffs have been collected from Canadian lumber producers since tariffs were imposed in 2017, a year after Canada’s last softwood agreement with its southern neighbour expired in 2016.

“Canada is disappointed that the United States continues to impose unwarranted and unjust duties on Canadian softwood lumber products,” Ng said in a statement.

“These duties impact our innovative Canadian softwood industry.

“And with the significant current challenges in housing supply and affordability, these duties also harm U.S. consumers and businesses that need Canadian lumber.”

Canada is facing a housing shortage as its population has increased significantly, growing by an average of 600,000 people annually over the past five years, reaching over 40 million.

That’s as home construction has struggled to keep pace.

There’s also a similar housing crunch in some parts of the United States.

Ng says the feds continue to raise the issue of softwood tariffs “at every opportunity” in attempts to find a resolution.

Canada previously turned to the U.S.-Mexico-Canada Agreement’s dispute resolution system in 2021 and 2022 after the United States imposed a previous round of tariffs.

It’s a move that has yet to resolve the standoff.

But a NAFTA Chapter 19 panel also ruled, in part, in Canada’s favour last year.

That panel has directed the U.S. Department of Commerce to review key aspects of its determination.

Meanwhile, Canada has also recently turned to the U.S. Court of International Trade.

The latest ruling by the U.S. International Trade Commission was part of a “sunset review,” a recurring five-year procedure to re-examine the justification for duty orders as required by federal law.

In a statement, the commission said that “revoking the existing antidumping and countervailing duty orders on certain softwood lumber products from Canada would be likely to lead to continuation or recurrence of material injury within a reasonably foreseeable time.”

The U.S. industry continues to contend that Canadian softwood is unfairly subsidized.

As part of the sunset review challenge, a binational panel will now be established and tasked with determining whether the decision to maintain duties on Canadian softwood lumber products was reached in a manner consistent with U.S. law.

“Canada remains ready and willing to discuss a resolution that provides the stability and predictability the sector needs to ensure its continued growth and success,” Ng said.

“We will always defend the Canadian softwood lumber industry and the workers and communities it supports.”

Twenty-five New Brunswick sawmills owned by 14 companies are affected by U.S. duties on Canadian softwood lumber, according to the provincial government.