Pulse: Public Backs Trump Tariffs Levied on Canadian Lumber

According to the May LANDTHINK Pulse results, 61.17% of respondents indicated that they think Trump is right for slapping tough tariffs on Canadian softwood lumber imports. Last April, the U.S. Department of Commerce said it would impose “countervailing duties” of between 3 percent to 24 percent on Canadian lumber exporters. Commerce Secretary Wilbur Ross said in his press briefing that Canada is a “close, important ally” and “generally a good neighbor” but Ross accused the country of unfairly dumping softwood lumber into the U.S market. Ross estimated the duties would amount to nearly $1 billion on softwood lumber, and indicated that it would be enforced effective immediately, and be retroactive, going back 90 days.

The United States and Canada have been engaged in a long-standing dispute over U.S. softwood lumber dating back to the Reagan administration. The majority of Americans and U.S. producers are lauding the hefty new tariffs. Even former President Jimmy Carter voiced support of the Trump administration’s anti-subsidy duties against the Canadian lumber imports. The 39th President stated his family owns around 1,800 acres of timberland and they have “suffered financially for many years” from Canada’s unfair “dumping”. The U.S. softwood lumber industry has long believed the U.S. has been flooded with cheap Canadian lumber and think the new tariffs will level the playing field.

The root of the problem is the fact that Canadian timber is owned and unfairly subsidized by provincial governments. Canadian loggers harvest timber on public lands at a below-market price that is set by the government. The prices are kept artificially low, and undercut American producers. As the results of our survey indicated, most believe that the imposed tariffs will result in a robust U.S. timber industry, healthier forests, and an increase in jobs.

Last month, the May Pulse asked: Do you support the new tariffs placed on Canadian softwood lumber imports? The overwhelming answer to our informal online survey was “YES”, given by 61.17% of those responding. Only 38.83% said “NO”, they did not support tariffs imposed on softwood lumber entering the United States from Canada.

Those that disapprove argue that U.S. consumers and new home buyers will feel the impact from the Trump-imposed tariffs. Canadian softwood lumber is the primary material used in framing single family homes, and the imports represent about 30% of the softwood lumber bought in the U.S., according to the National Association of Home Builders (NAHB). The NAHB has vehemently lobbied against the tariffs, warning that the increased prices homebuilders will be paying for the lumber will raise average home prices. In an Eye on Housing blog post, NAHB estimated that a 19.88 percent duty throughout 2017 would result in a loss of approximately 8,241 full-time U.S. jobs.

In anticipation of the duties, lumber costs have been steadily climbing since the beginning of the year. According to a NAHB press release, those costs have already added approximately $3,600 to the cost of an average single-family home, not including the land. Zoltan van Heyningen, executive director of the U.S. Lumber Association, has said he thinks the costs to American homebuyers would be less than the NAHB has estimated.

There is also the argument that the U.S. cannot produce enough domestic lumber to meet demand and is dependent on the Canadian imports. Zoltan van Heyningen has said in recent articles that more U.S lumber would be produced when the industry could compete on a level playing field against Canada.

Here are the final results:

• 61.17% said YES, they DO support the new tariffs
• 38.83% said NO, they DO NOT support the new tariffs

Thank you to everyone who participated and shared the Pulse with friends and connections in the land industry. LANDTHINK would like to extend a big thank thank you to FARMFLIP for sponsoring the May Pulse. FARMFLIP is part of the LANDFLIP NETWORK and is devoted to farmland for sale including agricultural land, horse farms, mini farms, CRP farms and other income producing farmland.

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