The Biden administration is recommending doubling tariffs on Canadian lumber despite the current skyrocketing prices for the materials for U.S. consumers.
“At a time when soaring lumber prices have added nearly $36,000 to the price of a new home and priced millions of middle-class households out of the housing market, the Biden administration’s preliminary finding on Friday to double the tariffs on Canadian lumber shipments into the U.S. shows the White House does not care about the plight of American home buyers and renters who have been forced to pay much higher costs for housing,” National Association of Home Builders chairman Chuck Fowke said in a statement.
The move, which would raise tariffs on Canadian lumber from 8.99% to 18.32%, comes as lumber pieces in the U.S. jumped 275% since last April.
“The administration should be ashamed for casting its lot with special interest groups and abandoning the interests of the American people,” Fowke said.
BUYING OR BUILDING A HOME CONTINUES TO GET COSTLIER
The finding was also heavily criticized by Canadian authorities, who called the increase a “tax on the American people.”
“U.S. duties on Canadian softwood lumber products are a tax on the American people. They make housing less affordable for Americans and hinder economic recovery from the COVID-19 pandemic,” said Mary Ng, a Canadian MP and the minister of small business, export promotion, and international trade.
“We will keep challenging these unwarranted and damaging duties through all available avenues. We remain confident that a negotiated solution to this long-standing trade issue is not only possible, but in the best interest of both our countries,” she added.
Canada has successfully challenged U.S. lumber tariffs before, most recently after former President Donald Trump’s administration imposed a 20% tariff on Canadian lumber. That number was brought back down to 9% after the World Trade Organization ruled in Canada’s favor.
The Trump tariffs resulted in skyrocketing prices at the time, though from a much lower base than the current prices.
But U.S. lumber manufacturers praised the findings, saying such tariffs are necessary to create a “level playing field” for U.S. businesses.
“A level playing field is a critical element for continued investment and growth for U.S. lumber manufacturing to meet strong building demand to build more American homes,” U.S. Lumber Coalition co-chair Jason Brochu said in a statement.
“More lumber being manufactured in America to meet domestic demand is a direct result of the trade enforcement, and we strongly urge the Administration to continue this enforcement,” he added.
Deacon Lumber Company founder Stinson Dean urged a “ceasefire” between the countries on the hot button trade issue in hopes that the two sides could come to a solution that will help increase the supply of lumber to U.S. consumers.
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“In my mind, any tax on Canadian lumber incentivizes them to look to sell to other markets. The U.S. needs all the supply it can get-and buyers will clearly pay for it-but if it doesn’t exist, it brings construction to a halt. Scarcity is the problem, not price,” Dean said.
