By Ana Swanson and Damian Paletta
The Trump administration announced on Monday it is planning to impose a roughly 20 percent tariff on softwood lumber imported from Canada, in what may be the biggest trade dispute between the U.S. and Canada in over a decade.
The Obama administration began the review of trade in softwood lumber last year out of concern that Canada was subsidizing its wood industry in a way that hurt U.S. rivals. The decision to impose what are known as “countervailing duties” in retaliation for Canada’s wood subsidies, which will be announced Tuesday, is subject to a final review by the International Trade Commission, an independent federal agency that advises the government on trade policy.
The decision, however, allows U.S. Customs and Border Protection to begin collecting the funds from Canadian importers immediately. Five Canadian companies were a part of the investigation, and the United States will seek to collect money from four of them retroactively for actions taken in the past 90 days, Ross said.
Ross said this could amount to $1 billion in new tariffs, as well as $250 million in retroactive collections. All other Canadian softwood lumber companies will face the same tariff of 19.88 percent going forward.
Softwood lumber is a major export of Canada, which sold $5.8 billion in lumber to the United States last year, giving it about 31.5 percent of the U.S. market. It’s the fourth largest export from Canada to the United States after oil, gas and cars.