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U.S. Consumer Reps Meet with B.C. Premier, Minister of Forests

on 8/21/01.

Several representatives of U.S. consumer and business groups opposed to any new tariffs on Canadian Lumber imports to the U.S. are in Victoria and Vancouver today to meet with B.C. Premier Gordon Campbell, Forest Minister Mike de Jong, and members of the B.C. Government Caucus Committee on Natural Resources, a delegation of mayors and several forest company executives in the Province.
"Our message is simple," said Susan Petniunas, spokesperson for the 15-member alliance, American Consumers for Affordable Homes (ACAH). "We are here urging that Canada and specifically British Columbia, resist negotiating any new trade restraint on softwood lumber exports to the U.S., and that it vigorously join U.S. consumers in continuing to fight recent duties imposed by the Bush Administration. The recent countervailing duty determinations totally political, violates major NAFTA and WTO provisions, and was done in such a way to try and force Canada to once again cower at the negotiating table."
The delegation today included leadership from the National Association of Home Builders, National Lumber and Building Materials Association, The Home Depot, and CHEP USA. They emphasized U.S. consumer support for moving the two countries to free trade in lumber and said that there are more than 100 members of the U.S. Congress who recently sent a letter to President Bush expressing their support for U.S. consumer interests instead of the protectionist interests of a segment of the U.S. industry. ACAH members represent more than 95 percent of the U.S. consumption of softwood lumber from Canada.
Bobby Rayburn, a home builder from Jackson, Miss., and vice president/secretary of the National Association of Home Builders (NAHB), said: "NAHB is strongly opposed to any tariffs on Canadian lumber imports. The U.S. Commerce Department's preliminary determination to impose a 19 percent levy will add up to $1,000 to the cost of building a typical new home. U.S. home builders and other domestic industries that depend on Canadian lumber will work very hard to ensure that it is freely traded between the U.S. and Canada."
"The recent Commerce decision stands to drastically injure the ability of many U.S. lumber dealers to stay in business," said Mike Fritz, president of Rugg Lumber Co. with lumberyards in Greenfield and Northampton, Massachusetts. He is the chair-elect of the National Lumber and Building Materials Association that represents 9,000 locally owned lumber dealer firms throughout the U.S. "In our industry, contracts are written 3 to 12 months in advance in most cases. A 19 percent tax means that lumber dealers will have to absorb all of this added cost, making it much more difficult for yards struggling with 2-3 percent margins to stay afloat."
There have been three previous countervailing duty cases on this issue, and in each case in which it was taken to a final decision, it was ultimately determined that the Canadian government did not provide unfair subsidies to its lumber industry.
Fritz added that he felt confident that, "as this case moves forward the ITC and WTO will see right through the numerous and obvious holes in the decision, and invalidate the injustice done August 10. Unfortunately, it will be too late for many lumber dealers and too late for many home builders and new home buyers.
When reversed, the U.S. will be forced to refund money collected through the unjust tariff, but lumber dealers and homebuyers will not see refund checks on higher prices they are forced to pay to subsidize the inefficiency and greed of some U.S. producers. The damage to consumers is already done."
The Home Depot representative, Steve Conwell, Global Product Merchant for Lumber, told government officials that the uses of Canadian softwood lumber cannot be met by the U.S. supply, and that southern yellow pine is no substitute for Canadian spruce pine fir for most construction needs. "Quite frankly, if we cannot get the types of softwood lumber our customers need, we will look elsewhere. Canada is the logical trading partner for this product, and ending trade restraints is critical." In the U.S., The Home Depot has stores in 48 states, and operations in Chile, Argentina, Puerto Rico, Mexico, and Canada.
"As an international company, CHEP strongly believes that free trade in lumber, or anything else, benefits consumers on both sides of the US-Canadian border. In contrast, trade restraints hurt everyone," said Scott Cameron of CHEP USA. "The acquisition cost of the millions of pallets that CHEP buys and then rents every year has gone up in reaction to concerns about unjustified countervailing duties and dumping penalties. These higher costs are passed on to CHEP customers, who use our pallets to ship groceries, fresh produce, and other consumer goods to retail stores. American families and senior citizens are paying for these higher costs at the grocery store checkout counter. Trade restraints amount to nothing less than an unprecedented and regressive national sales tax on food and other essential goods purchased by American consumers. Because it is a regressive tax, it hits less wealthy Americans the hardest," concluded Cameron.
Petniunas said that while some characterize this as a lumber producer's issue, "it clearly is not. Consumer viewpoints have been ignored in all prior considerations of this issue, but clearly consumers bear the brunt of any trade restraint imposed. If the 19 percent countervailing duty is not overturned, and the anti-dumping request for duties of 39 percent were to be imposed, more than one million American families will be unable to qualify for mortgages to buy a new home. Most impacted are first-time homebuyers and seniors moving to a more affordable retirement housing. Consumer views must be considered in what we hope will be a fair, open process."
Other U.S. alliance members include Citizens for a Sound Economy, Consumers for World Trade, Free Trade Lumber Council, International Mass Retail Association, International Sleep Products Association, Leggett & Platt Inc., Manufactured Housing Association for Regulatory Reform, Manufactured Housing Institute, National Black Chamber of Commerce, National Retail Federation, and the United States Hispanic Contractors Association.