More than 95 percent of all imported lumber came from Canada previous year. Foreign companies that receive financial assistance from foreign governments that benefits the production of goods from foreign companies and is limited to specific enterprises or industries, or is contingent either upon export performance or upon the use of domestic goods over imported goods, are subject to CVD duties.
He says the slight reduction in rates is a sign Canada's pending appeal is strong, but that can't be filed until December, so he's taking 35 forestry stakeholders to China and Japan later this month to secure new markets.
One source with knowledge of the softwood discussions said the impediment to a deal was the US lumber industry, which appeared to prefer hitting Canada with tariffs than agreeing to a negotiated settlement.
"I'm sure everyone is relieved (today), we certainly are, but you never know when you're in these negotiations", McNeil said. The Canadian industry wants to retain the right to supply larger amounts of lumber to US consumers when needed, according to people following the talks.
The United States and Canada have been working on a long-term deal to manage the softwood lumber trade, a prolonged prickly trade issue between the two economic partners.
Softwood lumber producers in other provinces not lucky enough to be exempted from the duties had the amount they are required to pay reduced slightly.
The final countervailing duty rate is 14.25% (a decrease from the preliminary rate 19.88%) and the final anti-dumping duty rate is 6.58% (a decrease from the preliminary rate 6.87%).
Early in his tenure as Commerce Secretary, Mr. Ross proposed a deal based on stumpage fees, in which Canada would agree to a market mechanism for calculating what companies would pay to fell timber, the source said.
Commerce Secretary Wilbur Ross said in a statement that the United States remains committed to "free, fair and reciprocal trade with Canada", and that the decision is based on "a full and unbiased review of the facts in an open and transparent process".
"This decision is based on a full and unbiased review of the facts in an open and transparent process that defends American workers and businesses from unfair trade practices", Ross said.
The Trudeau government responded by saying it will continue to defend the Canadian lumber industry against protectionist trade measures, including possibly turning to litigation.
With the USA and Canada unable to reach a long-term settlement, the Commerce Department on November 2 announced affirmative final determinations in antidumping and countervailing duty investigations of softwood lumber imports from Canada.
The ministers said: "We urge the US Administration to rescind these duties, which harm workers and communities in Canada. It is nothing more than a thinly-disguised tax on American home buyers, home builders and consumers".
The trade issue will probably not be resolved in the near term as the renegotiation of the North American Free Trade Agreement has taken center stage, Mark Wilde, an analyst with BMO in NY, said Wednesday in an email.
The U.S. government says that exporters from Canada have sold softwood lumber in the U.S. market at 3.20 per cent to 8.89 per cent less than fair value. Canada also is providing unfair subsidies to its producers at rates from 3.34 percent to 18.19 percent. Canadian unions and lumber companies fear the issue will eventually cause layoffs.
In 2016 Newfoundland and Labrador exported $10.5-million worth of softwood lumber to the United States.