The Canadian Press
The United States has fired the opening shot in a latest softwood lumber war against Canada, with the Trump administration announcing its first batch of duties on imported wood in the neighbourhood of 20 percent.
The move was expected: the historic dispute over lumber pricing has led to once-a-decade trade skirmishes between the neighbours, resulting in American duties, then inevitable court battles, and ultimately negotiated settlements.
What wasn’t expected yesterday was the enthusiasm with which the new American administration flung itself into the lumber hostilities, touting its incoming countervailing duties as an example of U.S. President Donald Trump’s tough, America-first trade posture.
Trump underscored the impending move by announcing it to a gathering of conservative media.
Commerce Secretary Wilbur Ross also highlighted it in interviews, and both of them linked the issue to broader trade complaints.
Then came a statement that said U.S. Customs will begin collecting cash deposits from Canadian logging companies because they receive a range of subsidies–most of them allegedly about 20 percent.
Trump told the conservative media gathering, according to Breitbart News: “We love Canada, wonderful people, wonderful country, but they have been very good about taking advantage of us through NAFTA.”
Ross went out of his way to link this dispute to broader complaints, about dairy and about NAFTA.
“It has been a bad week for U.S.-Canada trade relations,” he said.
“This is not our idea of a properly functioning free trade agreement.”
The softwood spat is unfolding amid a much bigger trade issue–the renegotiation of the North American Free Trade Agreement.
Despite remarks from the president and his cabinet secretary, neither lumber nor dairy actually are part of the current NAFTA.
However, different actors would be pleased to add provisions on one or the other.
What comes next on softwood is a study of separate anti-dumping duties, followed by a final verdict by the U.S. Commerce Department as early as Sept. 7.
And then one of three possible outcomes: a negotiated agreement, a surprise retreat from the U.S. government, or a potential years-long court battle.
