The U.S. set final tariffs on Canadian softwood lumber Thursday, increasing pressure on the Canadian timber industry at a time when economic relations between Washington and Ottawa are strained.
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The U.S. Commerce Department cleared the way for significant tariffs due to alleged dumping and subsidies of softwood timber coming from Canada. Those tariffs will become permanent if the U.S. International Trade Commission makes a final determination this year that American industry was harmed by the alleged dumping and subsidies.
U.S. and Canadian officials have been working for months with industry representatives to come to an agreement to avoid the tariffs announced Thursday. The acrimonious talks have also weighed on relations between the neighboring nations as they seek to overhaul the North American Free Trade Agreement at the request of U.S. President Donald Trump. In another trade case, the Commerce Department imposed preliminary duties on Bombardier Inc. jets.
"While I am disappointed that a negotiated agreement could not be made between domestic and Canadian softwood producers, the U.S. is committed to free, fair and reciprocal trade with Canada," Commerce Secretary Wilbur Ross said. "This decision is based on a full and unbiased review of the facts in an open and transparent process that defends American workers and businesses from unfair trade practices."
Some firms were assigned specific tariffs. Canfor Corp. was assigned total dumping and subsidy tariffs of 22.1%, while West Fraser Timber Co. Ltd. had total tariffs of 24.5%. Firms not specifically identified got total tariffs of 20.8%.
In the stalled negotiations toward a deal that would avoid tariffs, the U.S. industry blamed Canada for not agreeing to limit its market share of softwood lumber in the U.S. below a set level. The Canadian industry prefers to retain the option to supply larger amounts of lumber to U.S. consumers, led by home builders, according to people following the talks.
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"We are pleased the U.S. government is enforcing our trade laws so that the U.S. lumber industry can compete on a level playing field," said Jason Brochu, co-chairman of the U.S. Lumber Coalition and co-president of Pleasant River Lumber Co. in Maine.
Canadian officials weren't immediately available for comment. They had previously said the Commerce Department's findings were without merit, and that Canada planned to contest them.
Paul Vieira contributed to this article.
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(END) Dow Jones Newswires
November 02, 2017 12:41 ET (16:41 GMT)