On Friday, May 22, the North American Free Trade Agreement (NAFTA) ruled in favour of the U.S. International Trade Commission (USITC) determination that the Canadian lumber industry has harmed the U.S. industry.

Canadian side disappointed with NAFTA ruling

“Our government is extremely disappointed in the NAFTA panel’s ruling affirming the USITC’s January 2018 material injury determination,” Doug Donaldson, Canadian minister of Forests, Lands, Natural Resource Operations and Rural Development, said in a press release.

“This is only one piece in the ongoing softwood lumber dispute, and resolving this dispute is our top trade priority. Separate NAFTA appeals of the Department of Commerce’s countervailing duty and anti-dumping duty determinations have also been initiated.”

Susan Yurkovich, president of the BC Lumber Trade Council likewise expressed disappointment but said there are still other international tribunals that have yet to rule on the claim that Canada unfairly subsidizes its forest industry, which has resulted in American countervail and anti-dumping duties of more than 20% on Canadian lumber exports to the U.S. B.C. producers are the hardest hit by the duties.

“We remain convinced that the determination that the U.S. lumber industry is ‘injured’ by Canadian lumber imports is flawed and without merit,” Yurkovich said.

The lumber council pointed out that the ruling is not the final one. There are still appeals to be heard by the World Trade Organization (WTO).

“Even with today’s decision affirming the USITC remand determination on injury, the Canadian parties still have pending WTO and NAFTA challenges to the Department of Commerce’s underlying countervailing duty and anti-dumping duty determinations that have yet to be resolved,” the lumber council said in a press release.

“We are confident that those proceedings will yield favorable results as they have done in the past, and that the duties ultimately will be ruled to be unwarranted. “

U.S. side happy with the decision

The U.S. Lumber Coalition issued the following statement regarding the decision issued by a NAFTA panel affirming the U.S. International Trade Commission’s (ITC) findings.

“The U.S. Lumber Coalition is very pleased with the decision of the NAFTA panel completely affirming the ITC softwood lumber injury remand determination, in which the ITC once again found that unfairly traded Canadian softwood imports harm U.S. producers and workers,” said Zoltan van Heyningen, Executive Director of the U.S. Lumber Coalition.

The ITC addressed all of the issues identified by the NAFTA panel and again unanimously found that the U.S. industry was materially injured in a 5-0 remand determination issued December 2019. The NAFTA panel has now affirmed the ITC’s remand determination.

“The U.S. Lumber Coalition fully supports the enforcement of America’s trade laws. The evidence presented to the ITC was clear – the massive subsidies that the Canadian government provides to its lumber industry and the dumping of lumber products into the U.S. market by Canadian companies cause real harm to U.S. producers and workers,” said U.S. Lumber Coalition Co-Chair and Co-President of Pleasant River Lumber Company, Jason Brochu.

“Now that the NAFTA panel has affirmed the ITC determination, the U.S. lumber industry, and the 350,000 hardworking men and women who support it, will continue to have the chance to compete fairly. We applaud the U.S. government for its vigorous defense of the ITC’s unanimous injury determination,” concluded Brochu.

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