Home Industry News LBM dealer, builder, and lumber groups address tariff increase

LBM dealer, builder, and lumber groups address tariff increase

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As the U.S. Dept. of Commerce announced a near doubling tariffs on Canadian lumber shipments from 9% to 17.9%, advocacy groups such as the National Association of Home Builders and the National Lumber and Building Material Dealers Association, American Building Materials Alliance, and the U.S. Lumber Coalition have spoken out about the measure.

The move is “a gut punch to American home buyers,” said NAHB via Chairman Chuck Fowke.

“With the nation in the midst of a housing affordability crisis, the Biden administration has moved to slap a huge, unwanted tax hike on American home buyers and renters by doubling the tariffs on Canadian lumber shipments into the U.S. This is the worst time to add needless housing costs onto the backs of hardworking American families. Home builders are grappling with lumber and other building material supply chain bottlenecks that are raising construction costs. And consumers are dealing with rising inflation that is pushing mortgage interest rates higher.

“This decision undermines the historic funding commitment made to housing in the Build Back Better legislation and erodes efforts by Commerce Secretary Raimondo and other Biden administration officials to tackle the lumber and building materials supply issues plaguing the industry. Doubling the tariffs will only exacerbate market volatility, put upward pressure on lumber prices and make housing more expensive. Rather than placating China and Europe with sweetheart trade deals, the White House needs to change course and move immediately to engage with our Canadian partners on a long-term solution to the trade dispute that will end tariffs and help restore price stability to the lumber market.”

The NLBMDA also condemned the decision. Jonathan Paine, NLBMDA President & CEO, said “NLBMDA strongly condemns the decision by the U.S. Department of Commerce to double tariffs on Canadian softwood lumber imports and calls on the Biden administration to reverse this unnecessary action. “As the economy continues to grapple with crippling supply chain disruptions and price volatility, now is the wrong time to impose a new tax on American consumers and small businesses through additional tariffs. These tariffs will only exacerbate the nation’s affordable housing shortage and amplify existing challenges facing lumber and building material dealers.

“This decision is even more troubling given that it directly contradicts the Administration’s previous efforts to address global supply chain disruptions, such as lifting tariffs on European steel and aluminum. NLBMDA strongly urges the Biden administration to pursue a permanent trade agreement with Canada that eliminates tariffs and brings long-term stability to the supply and pricing of softwood lumber.”

The American Building Materials Alliance agreed, and in a letter to President Biden said, “The rapidly escalating building costs and unpredictable prices continue to threaten affordable housing developments, renovation work and numerous projects in both residential and commercial properties. According to Random Lengths, in 2021, the price of lumber hit an all-time high of more than $1,600 per thousand board feet in May, dropped to $455 in August, and increased to $796 in November. These fluctuating prices are causing chaos throughout the supply chain and are making it difficult for prospective homeowners to commit to home ownership.

“A new Softwood Lumber Agreement (SLA) would play a critical role in mitigating this growing threat to both the lumber and building materials (LBM) and construction industries. The most recent SLA between the US and Canada expired in 2015 and since that time, the LBM industry has repeatedly called for a new agreement. The absence of an SLA has resulted in an endless cycle of U.S. countervailing duties and antidumping duties on Canadian softwood lumber imports that have done little to help solve this trade dispute.”

The U.S. Lumber Coalition, an alliance of large and small softwood lumber producers from around the country, however, applauded U.S. Dept, of Commerce’s “continued strong trade law enforcement.”

“The U.S. Lumber Coalition thanks the Commerce Department’s for their hard work and continued commitment to strongly enforce the U.S. trade laws against unfairly traded Canadian lumber imports,” said Jason Brochu, chairman of the U.S. Lumber Coalition and Co-President of Pleasant River Lumber Company.  “Trade law enforcement maximizes long-term domestic production and lumber availability and has already resulted in dramatic growth of U.S. made lumber to meet strong demand to build more American homes,” added Brochu.

“The U.S. Lumber Coalition strongly urges the Administration to continue full trade law enforcement. More U.S. lumber being produced in America to meet domestic demand is a direct result of the enforcement. A level playing field is critical for the continued investment and growth of the domestic lumber industry and its hundreds of thousands of workers and thousands of communities across the United States,” concluded Brochu.