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U.S.-Canada Lumber Trade Issue > Latest Developments

The U.S. Department of Commerce released its preliminary determination in the countervailing duty case against Canadian lumber imports April 25. This 12-page report details its findings. (in PDF file format). For more information, see the historical timeline on the U.S.-Canada Lumber Trade Dispute page. Current news may also appear on the Special Reports page.

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Canadian trade ministers turn attention to China
While a potential conflict looms with the U.S. over trade, Canada’s Liberal government is continuing to cozy up to China. Canadian ministers had high-level discussions and a private dinner this week with powerful Chinese officials, including the vice-premier who was seated next to President Xi Jinping at Donald Trump’s Mar-a-lago resort at the beginning of the month. According to a Canadian government official, Finance Minister Bill Morneau and International Trade Minister François-Philippe Champagne sat across from Vice Premier Wang Ying (one of four vice-premiers directly under Xi) at a boardroom table before being treated to a “very traditional Chinese banquet” afterwards. It capped off a six-day mission to China led by Champagne. For more, click here...

Preliminary CVD notice publishes in Federal Register; cash deposits now required
The International Trade Administration of the U.S. Department of Commerce today published in the Federal Register the preliminary countervailing duty determination on softwood lumber from Canada. This means that April 28, 2017 is the effective date of cash deposit requirements on imports of softwood lumber products from Canada. For more, click here...

Former US Trade Rep: New SLA was close
A former U.S. trade representative says the Obama administration was on the verge of signing a new softwood lumber deal with Canada but the pact fell through when someone on the Canadian side felt a better deal could be reached with the incoming Trump administration. Michael Froman made the remarks in an interview on CBC News Network's Power & Politics one day after U.S. Commerce Secretary Wilbur Ross said Canada is dumping softwood lumber south of the border. "We worked very hard, particularly over the course of the last year, at Prime Minister [Justin] Trudeau's request to try and find a solution to that, find an agreement," Froman said. "I think we could have gotten one, but a judgment was made late in the year that since President [Donald] Trump was... from the building industry, he might be more receptive to the interests of builders and the Canadian government preferred to take their chances with him and we'll see how that plays out," Froman told Power & Politics host Rosemary Barton. For more, click here...

Trump, Trudeau talk trade again
Canadian Prime Minister Justin Trudeau and U.S President Donald Trump spoke again about bilateral trade on Wednesday, the second conversation in as many days between the two leaders amid strains over softwood lumber and dairy. Trudeau's office declined to say who initiated the phone call and revealed no details about the tone or content of the conversation, saying only that Trudeau continued to emphasize the importance of trade to U.S. jobs. It is extremely rare for the two to speak two days in a row, highlighting tension between their countries. For more, click here...

Freeland touts progress on softwood, vows to be 'tough' with US
Foreign Affairs Minister Chrystia Freeland is shooting back at Donald Trump’s anti-Canadian trade rhetoric saying she will be “tough and strong” in fighting for Canada’s economic interests with the U.S. Freeland also says she is optimistic a new softwood lumber deal can reached, and that it will be a win for Canada and the United States. Freeland says she has had discussions with Commerce Secretary Wilbur Ross in recent days and some progress has been made, but there’s no sign of a deal yet. For more, click here...

Nova Scotia included in duty case, for now
After a day of uncertainty, the Nova Scotia government admitted late Tuesday afternoon it has lost a long-standing exemption from U.S. border taxes on softwood lumber exports from the province, at least for now. "Needless to say, we are disappointed," said Trade Minister Michel Samson. Earlier in the day, Samson said the province was awaiting official confirmation on the fate of the exemption from American authorities. As of May 1, a 19.88% tariff will be imposed on Nova Scotia softwood forest products shipped into the U.S. For more, click here...

Canada issues statement on CVD ruling
The Honourable Jim Carr, Minister of Natural Resources, and the Honourable Chrystia Freeland, Minister of Foreign Affairs, today issued the following statement following the imposition by the U.S. Department of Commerce of duties on imports of certain Canadian softwood lumber products into the United States: "Canada's forest industry sustains hundreds of thousands of good, middle-class jobs in communities across our country. Many regions across Canada depend on its continued success. The forest industry is one of the most innovative sectors of our economy, developing new products and expanding its markets overseas while ensuring our environment is protected for future generations. The Government of Canada disagrees strongly with the U.S. Department of Commerce's decision to impose an unfair and punitive duty. The accusations are baseless and unfounded." For more, click here...

'From Tweaks to teats': Canada-US tensions mount
Canada-U.S. trade tensions have moved quickly from “tweaks to teats,” as Bank of Montreal puts it. Next up, and long contentious, is softwood lumber. Indeed, the decision by the U.S. Commerce Department on preliminary countervailing duties Tuesday promises to raise the temperature to the point where milk boils. Access to this story may require a subscription. click here...

New Brunswick fights for exclusion from duties
Twenty-five New Brunswick sawmills owned by 14 companies will be affected if the United States imposes a duty on Canadian softwood lumber, according to the provincial government. The government announced Friday it intends to fight for exclusion from border duties on softwood lumber and last month set up a task force with representatives from 11 departments to look at what can be done to mitigate the effects of any duty. For more, click here...

Canada assessed preliminary CVD rate of 19.88%
A preliminary countervailing duty rate of 19.88% will be levied against Canadian softwood lumber exports to the U.S. Individual rates will be assessed to the five companies that were investigated. They are: West Fraser, 24.12%; Canfor, 20.26%; Tolko, 19.50%; Resolute, 12.82%; and J.D. Irving, 3.02%. The weighted average of those five companies' rates determine the "all other" CVD rate of 19.88%. Special circumstances were found against J.D. Irving and "all other" Canadian companies, which means those duties will be retroactivce 90 days from when the CVD determination is published in the Federal Register, probably back to around February 1. West Fraser, Canfor, Tolko, and Resolute will not be required to pay retroactive duties. Commerce is scheduled to issue a preliminary determination in the anti-dumping duty case June 23.

Reminder: Preliminary CVD ruling scheduled announcement April 25
Random Lengths will send email and fax subscribers a Special Report on the Department of Commerce's preliminary ruling in the countervailing duty case as soon as we have reliable information on the decision from our sources or directly from the DOC announcement, whichever is available to us first. While April 24 is the statutory deadline for the DOC to make its decision, the department has indicated it will announce the decision on April 25.

Canadian trade minister to promote lumber in trip to China
OTTAWA -- While exploratory talks on a Canada-China free-trade deal are set to resume here next week, the Canadian Cabinet minister in charge of the trade file will be in China hoping to expand demand for a key Canadian export. Currently, the largest market for Canadian softwood lumber is the United States. But Canada and the U.S. have been locked in a decades-long trade dispute over the wood, which could intensify next week when the U.S. Commerce Department is expected to announce whether it will impose a countervailing duty on Canadian softwood lumber imports. "Diversification is part of the solution to that," Canadian International Trade Minister François-Philippe Champagne told Xinhua in an interview here Thursday. "My role as chief marketing officer of Canada is to make sure the forestry industry throughout Canada is healthy." For more, click here...

Trump takes aim at Canada in dairy, lumber, energy
U.S. President Donald Trump escalated his attacks on cross-border trade Thursday, repeating his criticisms of Canada’s dairy industry but expanding his rhetoric to condemn lumber and energy. The remarks will test the “good lines of communication” Canada’s government says it has established with Trump’s White House since the new administration took office. After signing an executive order in Washington that directs his administration to investigate whether steel imports jeopardize U.S. national security, Trump decided to repeat remarks he made earlier this week on Canadian dairy policies. He called them a “disgrace” to U.S. farm workers. For more, click here...

Facts related to trade dispute available on website
With the preliminary determination in the countervailing duty case against Canadian lumber imports scheduled to be publicly announced April 25, a number of traders have contacted Random Lengths seeking information on the case. Don't remember previous duty rates or how previous cases were resolved? It's all included in our timeline of the long history of the dispute, and is available at Click on In Depth, and then U.S.-Canada Trade Dispute. An abbreviated timeline is now available on the five duty petitions that have been filed in the case since 1982. An expanded, month-by-month look at the history of the dispute is also available, along with other charts and facts related to the case.

Preliminary decision in dumping case pushed back to June 23
The U.S. Department of Commerce announced today that it was postponing the preliminary determination in the anti-dumping duty investigation until June 23. The U.S. Lumber Coalition, which filed countervailing and anti-dumping duty petitions against Canadian lumber imports, had requested the delay. Citing "no compelling reasons to deny the request," Commerce postponed the preliminary AD determination, which had originally been scheduled May 4. Under the current schedule, the preliminary determination in the CVD case is scheduled for April 24, and the preliminary determination in the AD case is scheduled for June 23. As was reported in the April 13 issue of WoodWire, the Coalition has also requested that Commerce align the final decisions in the CVD and AD cases. A decision on that request has not yet been announced.

New developments arise in AD/CVD cases
Recent filings with the Department of Commerce could adjust when final duty decisions are announced, but the preliminary determination in the countervailing duty case against Canadian lumber imports is still scheduled for April 24, Random Lengths has confirmed. Commerce is expected to publicly announce its preliminary CVD ruling on April 25. The preliminary determination in the anti-dumping case is expected to be made June 23, although Commerce has yet to confirm that exact date. Today, the petitioner in the duty cases, the U.S. Lumber Coalition, filed a request with Commerce to align the final decisions in the CVD and AD cases. If approved, final AD/CVD determinations would likely be announced in early November. The last stage in these duty cases is a final determination from the International Trade Commission, which rules on whether the U.S. lumber industry has been injured. That ruling comes 45 days after the final AD/CVD ruling, or likely in late December. For information on further developments, read Random Lengths' Through a Knothole, or Random Lengths WoodWire.

Council: SLA 'critical' to BC forestry sector
Frustrations and fears are continuing to mount across B.C.'s forestry sector as negotiations for a softwood lumber agreement have fallen flat. It's been 18 months since the Canada-U.S softwood lumber agreement expired, and current negotiations have been hampered by U.S. allegations that subsidized Canadian imports are undercutting American producers. For more, click here...

Trump to examine trade partners, including Canada
Justin Trudeau is driving home the message that Canada and the United States share a special relationship that relies on the continued smooth flow of commerce across their border. The prime minister says that means jobs in both countries, a message Canada will continue to impress on the Americans as Donald Trump prepares to hold his country's major trading partners to account. The U.S. president wants to determine which countries are using abusive trade practices to run export surpluses — and Canada is among those to be examined. For more, click here...

BC envoy says window open slightly for lumber deal
British Columbia’s softwood trade envoy says there’s a slight opportunity to quickly negotiate a new lumber agreement between Canada and the United States, but if a deal can’t be reached by the summer or fall it could mean a lengthy fight. David Emerson said Wednesday he sensed a chance at a deal but also saw continued turbulence in the administration of President Donald Trump and strong protectionist sentiments in the US Congress after visiting Washington, D.C. last week. “My own guess is there is a window of opportunity, late summer or early fall, and if that doesn’t initiate something meaningful in terms of negotiations then I think we’re probably into next year,” he said. For more, click here...

Canadian softwood lumber in U.S. crosshairs, B.C. envoy says
British Columbia’s envoy in the latest softwood lumber dispute will be back in Washington this week and says recent comments by U.S. President Donald Trump’s trade nominee show he’s “clearly got his crosshairs on Canada.” David Emerson, who was Canada’s international trade minister when the last negotiated softwood lumber agreement with the United States was signed in 2006, was last month appointed as B.C.’s envoy in the new round of talks. The federal government is leading the file, but B.C. accounts for half of Canada’s softwood lumber exports to the United States and would bear the brunt of the imposition of duties. Robert Lighthizer, the U.S. President’s nominee for trade representative, told a Senate confirmation hearing last week softwood lumber was “at the top of the list” of issues he would address. Mr. Lighthizer said he would end the dispute through a new agreement or litigation. For more, click here...

NAHB CEO predicts long battle toward new SLA
Headaches over the supply and price of North American lumber likely will persist for several years, the CEO of the National Association of Home Builders told lumberyard executives last week, adding that one solution he's working on is to promote imports from Chile and perhaps Brazil. "I think it's going to take four to five years to have a resolution to the Softwood Lumber Agreement (SLA)," Jerry Howard told members of LBM Advantage, a buying co-op, at its annual meeting in Orlando. He was referring to the now-expired trade pact between Canada and the United States that is expected to result in tariffs of as much as 30% being imposed this spring. For more, click here...

Trade rep nominee: Lumber dispute 'at the top of the list'
President Donald Trump’s nominee for United States Trade Representative is vowing to end the long-running softwood-lumber dispute with Canada – whether by cutting a deal or fighting it out in trade court – and take Ottawa to task for not cracking down on counterfeit goods destined for the U.S. In a clear signal of the new administration’s bilateral priorities, Robert Lighthizer told his Senate confirmation hearing Tuesday that softwood is “at the top of the list.” For more, click here...

Ontario, Quebec more vulnerable to lumber duties
MONTREAL — Canada’s lumber industry is in a stronger position to weather a U.S. trade battle than it was during the last major clash a decade ago, but smaller Quebec and Ontario producers would be particularly vulnerable to duties that may arrive within weeks, industry observers say. B.C. producers such as West Fraser Timber, Canfor and Interfor have hedged their bets, purchasing sawmills in the U.S. primarily in the years when there was a truce over softwood. They’ve also seen softwood exports to China grow, giving them some degree of protection against tariffs that the U.S. could impose as early as May. “The big players in the West are now in a more comfortable position than they were 10 years ago,” says Andre Tremblay, head of the Quebec Forest Industry Council. “We are in a much more delicate situation now than during the last conflict.” For more, click here...

Canadian official says border tax would hurt both countries
Foreign Affairs Minister Chrystia Freeland has warned U.S. Commerce Secretary Wilbur Ross that a border adjustment tax would hurt businesses in both countries. Ms. Freeland spoke by telephone Thursday with Mr. Ross, the man tapped by President Donald Trump to lead the renegotiation of the North American free-trade agreement. For more, click here...

Canadian envoy heads south to talk lumber
The Province will be sending a special envoy to the U.S. early this week with aims to bring B.C. softwood lumber to the table with decision makers south of the border. Former provincial and federal politician David Emerson is heading south to begin talks on a new softwood lumber agreement, the predecessor of which had run its course in October 2015. Emerson will be bringing the issue to Ottawa first on Monday, where he will speak to senior officials, including the minister of foreign affairs and Quebec's representative to the U.S. For more, click here...

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