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Spike in drywall prices affecting construction

A tariff causing a spike in drywall prices could cause the price of new homes and renovations to increase. Adrian Raaber / Global News

New homes and renovations are getting more expensive. The effects of a new drywall duty are being felt in Saskatchewan.

The cost of a sheet has jumped up to approximately $13 from about eight dollars a few weeks ago.

“It’s just about doubled the price,” Dale Jelinski, owner of DJ’s Garage Interior’s and Renos, said.

The duty is levied on gypsum board coming into Western Canada from the U.S. It was introduced after a complaint from CertainTeed Gypsum Canada alleging that U.S. producers were dumping product into the market.

“Immediately upon that a 105 to 276 per cent duty was placed on drywall within Western Canada,” Stu Niebergall, Regina and Region Homebuilders’ Association president and CEO, said.

Niebergall said the tariff could increase the price of a new home by about $5,000. “In Saskatchewan, if we build about 6,000 homes, that turns about to be about $30 million that the consumer has to absorb,” he said.

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A $5,000 increase on the price of a home might also mean some people no longer qualify for a mortgage, Niebergall added.

“There’s a lot of pressure right now on homebuyers anyway with continuous price increases from all forms of government, and now with the new mortgage rules, less and less people are able to qualify for a mortgage,” he said.

Production of drywall has increased since the tariff was introduced, according to CertainTeed Gypsum Canada. As a result, about 30 jobs have been created in Vancouver, Calgary and Winnipeg.

“This is essentially to protect some jobs which are important in another province, but at a huge cost,” Niebergall said.

The Canadian International Trade Tribunal is scheduled to rule on Wednesday whether the alleged dumping has harmed Canadian industry. It’s also expected to issue a separate report into whether the duties are harming consumers.

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