Bipartisan group of lawmakers urge US, Canada to work on lumber deal

Bipartisan group of lawmakers urge US, Canada to work on lumber deal
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Dozens of House Democratic and Republican lawmakers are urging the Trump administration to go back to the negotiating table and strike a deal with Canada on softwood lumber.

The 171 congressional lawmakers, who sent a letter to Commerce Secretary Wilbur RossWilbur Louis RossOn The Money: US files complaints at WTO | House leaders get deal to boost biz investment | Mnuchin says US will consider Iran sanctions waivers | FCC deals blow to Sinclair-Tribune merger Ex-cyber officials demand to know security measures for 2020 Census It’s time to confirm the US Export-Import Bank Board for our economic security MORE and U.S. Trade Representative Robert LighthizerRobert (Bob) Emmet LighthizerMcConnell urges GOP senators to call Trump about tariffs Companies brace for trade war MORE, argue that the tariffs have significantly pushed up the prices on lumber used in the construction of U.S. residential building since the U.S. slapped tariffs on the wood announced in November.

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"With no agreement and tariffs averaging just over 20 percent in place, lumber prices have skyrocketed, hitting an all-time high this year," the lawmakers wrote.

"We respectfully request that you return to the negotiating table with Canada and redouble your efforts to reach a new softwood lumber agreement," they said.

"It is our hope that in negotiating a new agreement with Canada, you will push for measures that take into account not only the impact of price fluctuations on the domestic lumber industry, but also the effects on those secondary industries and consumers that rely on softwood lumber for their economic well-being." 

The 2006 agreement on softwood lumber expired Oct. 12, 2015.

Randy Noel, chairman of the National Association of Home Builders (NAHB) and a custom home builder from LaPlace, La., said the "current situation is clearly unacceptable."

"It's important to note that the congressional letter does not take sides in this trade dispute," Noel said.

"It simply highlights the urgent need for the U.S. and Canada to renew negotiations in an effort to come to an equitable solution that will satisfy all sides," he said.

Home builders, which oppose the tariffs, argue that prices on lumber have risen sharply this year, pushing up housing prices in a market that is struggling to meet consumer demand.

The tariff averages 20.83 percent on Canadian lumber imports, which were announced in November by the Commerce Department.

"Our members all over the country are telling us that this is killing housing," Jerry Howard, head of the NAHB, told The Hill.

The home builders have asked Ross to look into how the tariffs are affecting housing, which accounts for about 15 percent of the economy.

About 30 percent of all lumber used in U.S. home building comes from Canada, according to NAHB.

Howard said that besides the lumber problem, the industry still faces persistent issues of finding enough labor, land, financing for projects.

Trade in the wood has been contentious over the years, with the U.S. and Canada making several different agreements over the years to facilitate trade.

"Since the early 1980s, numerous disputes have disrupted trade patterns, leading to unnecessary cost increases for industries that rely on softwood lumber, and straining the relationship with one of our most important allies," the lawmakers wrote.

The U.S. Lumber Coalition, which supports the tariffs, calls the argument that the tariffs are pushing up prices "inaccurate."

"The price of lumber, like all commodities, fluctuates due to market forces," the group said in a statement.

"The trade measures — imposed after a thorough year-long investigation by the U.S. Department of Commerce and the International Trade Commission — are designed merely to offset the harm done to domestic producers from imports that are sold in the United States at less than fair value or which benefit from subsidies provided through foreign government programs," the Lumber Coalition said. 

Joe Patton, U.S. Lumber Coalition co-chairman and vice president of Wood Products at The Westervelt Company, said that "the U.S. industry remains open to an appropriate, effective and durable U.S-Canada trade agreement on softwood lumber imports that uses a quantitative metric for Canada’s maximum participation in the U.S. market."