Canadian Lumber Duties Jump Above 25% — With Higher Levies to Come Soon

Material Costs
Published

This post was updated on Aug. 3.

The U.S. Commerce Department has announced it is nearly tripling its anti-dumping duties on Canadian lumber imports from 7.66% to 20.56% following its annual review of existing tariffs.

“Commerce will now instruct U.S. Customs and Border Protection to begin collecting duties at the rates outlined in Commerce’s final results,” the U.S. International Trade Administration said in a press release.

The anti-dumping duties are in addition to current countervailing duties set at 6.74%, which would bring the total lumber duties above 27%. However, the countervailing duty rate is expected to move higher shortly, with the Commerce Department scheduled to announce its final administrative review of the countervailing order on Aug. 8. Commerce issued a preliminary determination on countervailing duties earlier this year that would raise the countervailing duty rate to 14.38%.

Moreover, President Trump in March directed the Commerce Department to launch a separate investigation under Section 232 of the Trade Expansion Act, which will examine whether lumber imports represent a threat to national security. Such a finding could result in higher lumber tariffs above the combined anti-dumping and countervailing duties.

Although NAHB is disappointed by this decision to raise lumber tariffs, it is part of the regularly scheduled review process the United States employs to ensure adequate relief to American companies and industries impacted by unfair trade practices.

For years, NAHB has been leading the fight against lumber tariffs because of their detrimental effect on housing affordability. In effect, the lumber tariffs act as a tax on American builders, home buyers and consumers.

Higher Tariffs for Many Nations

Separately, President Trump announced a slew of new tariffs for several nations on July 31. The 10% universal tariff remains in place but roughly 40 nations that run a trade deficit with the U.S. will see their tariff rate climb to 15%. These rates will go into effect on Aug. 7.

Tariffs on Canadian imports will rise from 25% to 35% but goods qualifying for preferential treatment under the United States-Canada-Mexico Agreement (including Canadian lumber) will not be subject to the 35% Canadian tariffs.

President Trump announced he would extend the Aug. 1 deadline for an additional 90 days with Mexico to make a deal. China’s deadline had earlier been pushed back to Aug. 12.

Adding further confusion is the chance that a legal challenge could prevent the administration from moving forward with its tariff policy.

The Court of International Trade initially blocked Trump’s tariffs from taking effect and the government appealed, allowing the tariffs to continue while the case moves forward. The case centers on whether Trump overstepped his authority to impose tariffs under the International Emergency Economic Powers Act. A panel of 11 judges for the U.S. Court of Appeals in Washington heard oral arguments in the case on July 30 and a decision could still be months away. 

With housing affordability already near a historic low, NAHB continues to call on the Trump administration to carefully consider how placing additional tariffs on lumber and other building materials will raise housing prices and impact housing supply. We are also urging the administration to move immediately to enter into negotiations with Canada on a new softwood lumber agreement that will provide a fair and equitable solution to all parties and eliminate tariffs altogether.

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