US lumber group warns of potential action against Canada amid trade standoff

Dive Brief:

  • The U.S. Lumber Coalition has accused Canada of allegedly "unfairly" subsidizing its U.S. sales and has threatened the country with trade actions, according to the Engineering News Record.  
  • A one-year moratorium during which both the U.S. and Canada agreed not to file trade actions against each other expired on Oct. 12. The bilateral softwood lumber agreement between the two countries expired last year, although both sides have continued negotiations.
  • The Vancouver-based BC Lumber Trade Council said it will participate in continued negotiations for a new trade deal but would also assist the Canadian government in defending against any U.S. trade actions.

Dive Insight:

In 2015, Canada's softwood lumber sales to the U.S. totaled $4.6 billion, and the National Association of Home Builders said that country's exports represented 28% of the U.S. market. Despite both governments maintaining that they want to reach an agreement, they have been unable to find enough common ground to cement a new deal. According to the NAHB, Canada's biggest gripe is the U.S.'s desire to reduce Canada's share of the market to 22%, phased in over a four-year period.

The NAHB maintains that the constant wood-trade disputes between the two nations have led to higher prices, and the association has recently engaged in talks with public and private groups in Chile regarding the import of wood products from that country. Chile currently has only 1.22% of the U.S. wood market. The NAHB claims that increased competition will help drive down prices, thereby boosting the American housing recovery. If American producers could keep up with demand, the association said they would prefer to buy all wood domestically.

In an effort to boost the U.S. lumber industry, the U.S. Department of Agriculture and various softwood organizations have promoted cross-laminated timber (CLT) as an alternative to steel and concrete for high-rises and other types of buildings. The USDA sponsored a competition last year for the best wood high-rise designs, with teams in Portland, OR, and New York taking the top prizes. And in April, the University of Oregon announced a CLT program that aims to determine its performance when faced with seismic activity or fire, one of the initiatives that CLT manufacturers are hoping will lead to revised building codes and broader use of the material in commercial applications.

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