Global Geo-political Series: U.S. commerce department announces final CVD on softwood lumber from Canada

Under the Trump administration, the U.S. commerce department, under the guidance of Secretary Wilbur Ross continues to take a tough stance on countries that have used unfair means to promote exports. Cracking down on U.S. deficit has been one of the core principles of this administration.

Last night, U.S. commerce department announced final countervailing duties (CVD) on imports of softwood lumber from Canada. The official statement says that despite significant exports made by both Canada and the United States, and the respective lumber industries to reach a long-term settlement, the parties could not reach a mutually acceptable solution. With that development, the Commerce Department determined that exporters from Canada have sold softwood lumber the United States at 3.2 percent to 8.89 percent less than fair value.  Commerce Department also determined that Canada is providing unfair subsidies to its producers of softwood lumber at rates from 3.34 percent to 18.19 percent and it has asked U.S. customs and border protection agency to collect cash deposits from importers based on these rates.

In 2016, imports of Softwood Lumber from Canada were valued at $5.66 billion.   

Commerce Secretary, Mr. Ross said, “While I am disappointed that a negotiated agreement could not be made between domestic and Canadian softwood producers, the United States is committed to free, fair and reciprocal trade with Canada….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.”

Under Trump administration, Antidumping (AD) and CVD investigations have increased by 61 percent compared to the same period in 2016. 77 investigations have been initiated by the administration.