Canada to challenge extension of US duties on softwood lumber

OTTAWA (Reuters) – Canada will challenge what Ottawa called an “unfair, unjust and illegal” expansion of U.S. import duties on Canadian softwood lumber products, the Commerce Department said on Tuesday.

The tariffs on softwood lumber are the legacy of a decades-long trade dispute over the structure of the Canadian softwood lumber sector that could not be resolved when a quota agreement expired in 2015. U.S. producers say Canada unfairly subsidizes its softwood lumber sector.

The US Department of Commerce set a duty rate of 7.99% on this product in July.

Canada filed notices of intent to begin judicial review of those rights on Monday, the Commerce Department said in a statement, adding that Ottawa remained willing to discuss a negotiated outcome with Washington. The department has regularly filed challenges under the rules of the U.S.-Mexico-Canada trade agreement.

“For years, the United States has imposed unfair, unjust and illegal duties on Canadian softwood lumber, harming Canadian industry and increasing housing costs in both countries,” said the Minister of Commerce, Mary Ng, in the press release.

The United States based its tariffs on the conclusion that Canadian timber harvested on federal and provincial lands with low government-set stumpage fees constitutes an unfair subsidy, while most American timber is harvested on private lands. at market rates.

The U.S. Trade Representative’s office said it was trying to ensure a level playing field.

“We are ready to discuss another softwood lumber agreement when Canada is ready to resolve the underlying issues related to subsidies and fair competition so that Canadian softwood lumber imports do not harm not to U.S. industry,” a USTR spokesperson said in an emailed statement.

The U.S. Commerce Department did not immediately respond to a request for comment.

(Reporting by Ismail Shakil in Ottawa and Urvi Dugar in Bangalore; editing by Susan Heavey, Devika Syamnath and Andy Sullivan)