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Lumber Trade Wars, the Sequels

Old trade cases don’t necessarily die, or even fade away, but they may get recycled.  Two new antidumping and countervailing duty petitions will require the United States Commerce Department and International Trade Commission revisit issues they already resolved in the past.

Softwood Lumber from Canada

The initial iteration of the first case, Softwood Lumber from Canada, was filed in 1982. There have been numerous proceedings over the decades, including bilateral agreements and contentious appeals before the General Agreement on Tariffs and Trade and NAFTA dispute resolution panels. Indeed, I worked on the Softwood Lumber GATT case when I was in the government; my issue was whether stumpage fees could qualify as a subsidy.

In this most recent round, a coalition of United States softwood lumber producers have filed a petition with the Commerce Department alleging that Canadian imports are “dumped” by margins of 20.12 percent to 52.89 percent. The petition also asserts these imports benefit from a plethora of Canadian Federal and Provincial subsidies.

The scope of the imported products covered by the petition is extensive: coniferous wood, sawn, or chipped lengthwise; coniferous wood siding, flooring, and other continuously shaped coniferous wood; coniferous drilled and notched lumber and angle cut lumber; (4) coniferous lumber stacked on edge and fastened together with nails; and semi-finished or unassembled finished components or parts. Included are such items as stringers, square cut box-spring-frame components, fence pickets, truss components, pallet components, and door and window frame parts.

Hardwood Plywood from China

This is the second go-round for the second case, Hardwood Plywood from China; the first investigation ended in 2014, with a negative determination of material injury. This time, the petitioning companies allege dumping margins of 105.94 percent on Chinese imports, as well as numerous countervailable subsidies conferred by the Chinese central and Provincial governments.

The scope of products covered is quite extensive: hardwood and decorative

Plywood, including “products that meet the American National Standard for Hardwood and Decorative Plywood, ANSI/HPVA HP-1-2016” and regardless of dimension.

Importers of softwood lumber and plywood products should brace themselves for supply and price disruptions, and are well-advised to evaluate whether their merchandise is described by the scope of investigation set forth in each petition.  The International Trade Commission’s Notice of Institution for the Hardwood Plywood case is published here.  The notice for Softwood Lumber is awaiting publication.

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