The United States Hispanic Contractors Association (USHCA), the fastest growing Hispanic business association in the U.S. with more than 130,000 member firms in 15 states, today added its voice to other consumer groups appealing to members of Congress to encourage the Commerce Department to reverse its preliminary decision to impose 19.3 percent duties on all softwood lumber imported from Canada, and to move to free lumber trade under NAFTA. The group is headquartered in Austin, Texas.
"It's unfortunate that the handful of U.S. forestry companies have sought protectionist action that amounts to imposing a federal sales tax on vital Canadian lumber needed for housing construction," said Frank Fuentes, chairman of the USHCA. "The needed supply of framing lumber is not available in the U.S. since we have historically continued to reduce our supplies of softwood lumber, and state and national forests have increasingly been placed off-limits for logging. Our housing sector can not prosper without Canadian softwood."
On August 10, 2001, the Commerce Department announced that it would impose a 19.3 percent countervailing duty on Canadian softwood lumber imports, which accounts for some 35 percent of U.S. softwood lumber consumption. A handful of U.S. producers, led by International Paper, Sierra Pacific, Potlatch and Temple Inland, along with southern landholders, petitioned Commerce to impose the duties when the U.S./Canada Softwood Lumber Agreement expired in April. That agreement put quota restrictions on the amount of lumber imported into the U.S. over a five year period.
Fuentes said that the proposed duty could reduce U.S. Gross Domestic Product
(GDP) growth from 0.05 percent to 0.11 percent at a time when GDP -- at last report -- is only 0.3 percent. Later this month, Commerce will rule on a request for an additional 39 percent in dumping duties that will further add to the "unprecedented federal sales tax on lumber in homes, and damage U.S. economic growth," he added. "These trade actions harm consumers all across the U.S."
The countervailing duty could raise the cost of a typical new home by $1,000 to $2,000. U.S. Census Bureau data have shown that a price hike of even this amount could drive thousands of households out of the housing market, depriving families of the American dream of home ownership, Fuentes said. "These costs significantly impact lower income, retiring senior citizens and first time homebuyers. If the antidumping duties are added, the numbers will be significantly higher."
"We are asking members of Congress to carefully weigh the impact of this trade restraint on housing affordability, and specifically on the fragile homebuilding sector of our economy," Fuentes said. "There is an affordable housing shortage in this country. We are encouraging members of Congress to join with more than 100 members of the Senate and House who are already calling for free trade in lumber through concurrent resolutions in the Senate and House (S. Con. Res. 4 and H. Con. Res. 45)." The two resolutions call for ending trade restraints and moving to free trade in softwood lumber between the U.S. and Canada.
"We also are appealing to our U.S. producers to support their customers and to end these senseless turf battles between our two countries," Fuentes said. "We should be working together to expand the market for wood, and compete against the growing use of wood substitutes, such as steel."
A similar appeal was made in mid-September by two ACAH member organizations, Manufactured Housing Institute and Manufacturing Housing Association for Regulatory Reform, pointing out that the cost of a manufactured home has increased by as much as $2,000 since the duties were imposed. The average cost of a manufactured home is $43,600. The manufactured housing builders rely on softwood lumber from Canada since southern yellow pine does not have the characteristics required for this type of construction.
Approximately six million U.S. workers are involved in lumber-using businesses, including home builders, remodelers, lumber dealers, and workers in industries such as wood pallet manufacturers, window frame and bed makers. More than 6 million workers are associated with the consumers of lumber and outnumber lumber-producing workers by 25 to 1 in the United States.
The ACAH represents approximately 95 percent of softwood lumber use in the U.S. ACAH members include CHEP USA, Citizens for a Sound Economy, Consumers for World Trade, Free Trade Lumber Council, The Home Depot, International Mass Retail Association, International Sleep Products Association, Leggett & Platt Inc., Manufactured Housing Association for Regulatory Reform, Manufactured Housing Institute, National Association of Home Builders, National Black Chamber of Commerce, National Lumber and Building Material Dealers Association, National Retail Federation, and the United States Hispanic Contractors Association.