An additional duty for softwood lumber and a fresh round of tariffs on furniture from U.S. President Donald Trump went into effect Tuesday morning, adding further strain on the Canadian lumber industry.
Last month, Trump signed a presidential proclamation announcing a 10 per cent tariff on imports of softwood timber and lumber.
He also announced a 25 per cent tariff on some furniture, such as kitchen cabinets and vanities. The furniture tariffs apply to parts, completed models and other upholstered wooden products.
The White House said these tariffs are in addition to any levies previously announced.
The B.C. Lumber Trade Council said that with Canadian producers already facing anti-dumping and countervailing duties of just over 35 per cent, Canadian softwood lumber entering the U.S. will now see total import taxes exceeding 45 per cent.
While Trump’s tariffs on furniture and lumber are global, some economists say they will disproportionately impact Canada.
Get breaking National news
The softwood lumber products that will be hit by the additional 10 per cent tariffs account for 1.3 per cent of all Canadian exports to the United States, according to analysis by RBC economist Claire Fan.
This move will also have an impact on the U.S. construction industry since 75 per cent of softwood lumber imports coming into the U.S. are Canadian, Fan’s report said.
The 25 per cent tariff on kitchen cabinets will also hit Canada, since one-fifth of all kitchen cabinets made in Canada were exported to the U.S., the report added.
As of Tuesday, Canada faces a higher tariff on kitchen cabinets than Europe does. This is because under Trump’s trade deal with the European Union, the EU will pay a flat 15 per cent tariff on all exports.
The Forest Products Association of Canada (FPAC) said it was “extremely frustrated and deeply concerned” by the latest tariffs going into effect.
The move will threaten the livelihoods of 200,000 Canadians connected to the industry and “the stability of hundreds of towns and cities that rely on a strong forest sector,” the industry body said in a statement.
“These are punitive, protectionist measures with no basis in fact. They ignore decades of evidence that Canadian lumber strengthens, rather than threatens, U.S. national security and economic resilience,” FPAC president and CEO Derek Nighbor said in a statement.
The tariff on kitchen cabinets and vanities is set to jump to 50 per cent in the new year, while the tariff on other upholstered wooden products will rise to 30 per cent on Jan. 1.
The duties come following a report by U.S. Commerce Secretary Howard Lutnick that Trump said found that wood products were being imported into the U.S. “in such quantities and under such circumstances as to threaten to impair the national security of the United States.”
The British Columbia Lumber Trade Council called the new tariffs “misguided and unnecessary.”
The Canadian Forest Product Sector said Trump’s move “is unjustified and disregards decades of evidence and cooperation that confirm Canadian forest products strengthen, rather than threaten, U.S. national security.”
The U.S. has long accused Canada’s softwood lumber sector of violating rules on anti-dumping — flooding a market with cheaper, subsidized products to disrupt a domestic industry.
The U.S. Commerce Department announced plans last month to nearly triple duties on Canadian softwood lumber to just over 20 per cent.
— with files from The Canadian Press
Comments