U.S. Increases Duty on Canadian Softwood Lumber by Almost 100%

The U.S. is significantly raising the duty on softwood lumber imports from Canada, setting the new rate at 14.54 percent, up from the previous 8.05 percent.

The updated rate was communicated to trade groups and government officials on Tuesday, though it has yet to be officially posted in the U.S. Federal Register.

Mary Ng, Canada’s Minister of Export Promotion, International Trade, and Economic Development, expressed her disappointment in a written statement, calling the increase “baseless and unfair.” She emphasized that these U.S. duties harm consumers and producers on both sides of the border and warned that the latest measure would negatively impact workers and their communities.

Bruce Ralston, British Columbia’s Minister of Forests, echoed Ng’s concerns.

In February, the U.S. Department of Commerce indicated it would significantly increase softwood lumber duties to 13.86 percent, but Tuesday’s announcement exceeded that expectation.

Under the U.S. Tariff Act, the Department of Commerce determines if goods are being sold below fair value or if they benefit from subsidies provided by foreign governments.

In Canada, provinces set stumpage fees for timber harvested from Crown land, a practice U.S. producers—who pay market rates—consider an unfair subsidy.

On Tuesday, the U.S. Lumber Coalition, an industry group, supported the Department of Commerce’s decision, arguing that it confirms Canada continues to subsidize and dump its softwood lumber products in the U.S. The coalition claimed that these Canadian practices distort the U.S. softwood lumber market, affecting sawmills, workers, and communities across the United States.

Niquidet, Ralston and Ng all vowed to challenge the U.S. decision with litigation under the North American Free Trade Agreement (NAFTA) and the Canada-United States-Mexico Agreement (CUSMA) at the U.S. Court of International Trade and at the World Trade Organization.