Partial victory for Canada in lumber dispute with U.S.

NAFTA panel sends claims of injury by American lumber producers back to trade commission for reconsideration

Canadian lumber producers are paying duties of roughly 20% on exports to the U.S.

Canadian softwood lumber producers are applauding what they see as a partial victory in the latest softwood lumber dispute with the U.S.

Canadian softwood lumber producers have been paying anti-dumping duties averaging 20% on exports of softwood lumber to the U.S.

On Wednesday, September 4, a North American Free Trade (NAFTA) panel ruled that claims of injury by American lumber producers against Canadian producers are flawed, and must be sent back to the U.S. International Trade Commission (USITC) for reconsideration.

“The panel’s decision to send the case back to the USITC for a new determination is in keeping with the fact that in previous softwood lumber litigation, not one of the USITC’s affirmative determinations on injury survived appeal to a NAFTA or WTO panel,” the BC Lumber Trade Council said in a news release.

Western Forest Products Inc (TSX: WEF) also applauded the decision, though it expressed disappointment that the NAFTA panel had not also ruled to exclude western red cedar from duties.

Canadian producers of specialty western red cedar products argue these products it should not be lumped into the same category as dimensional lumber.

“While we are pleased with the panel’s decision to send the U.S. lumber industry’s injury case back to the USITC for review, we are disappointed that the panel did not make a similar finding in relation to the USITC’s ruling that cedar/redwood is a distinct product group from commodity structural lumber,” Western Forest Products CEO Don Demens said in a press release.

“Softwood lumber duties continue to disproportionately impact high value, specialty wood products including Western Red Cedar, that have been unfairly brought into the dispute over structural lumber.”

nbennett@biv.com

@nbennett_biv