By BRENT JANG
Friday, June 15, 2018
VANCOUVER -- Canadian producers of cedar shakes and shingles are seeking to fend off new U.S. tariffs, waging war against the Trump administration more than three decades after Ronald Reagan imposed duties that lasted five years on the wood-roofing materials.
Canadian firms say the products have been unfairly targeted with duties of 20.23 per cent. They have formed a group, the Shake and Shingle Alliance, to oppose their inclusion in the U.S. tariffs on softwood lumber.
The group's members "were caught off guard" by the surprise addition of their products three months ago to the dispute over softwood lumber, according to a 55-page submission from the alliance this week to the U.S. Department of Commerce that asks for Canadian shakes and shingles to be exempt from tariffs.
"We request that the Department expedite to the greatest possible extent its review of this request and render a decision at the earliest possible time to prevent further injury," the alliance said in its document, addressed to Commerce Secretary Wilbur Ross.
The U.S. customs and border agency told the companies in a notice on March 15 that wood products that are tapered to less than six millimetres in thickness at one end are not necessarily exempt from the softwood tariffs.
A lawyer for the alliance raised Canada's concerns, including opposition to the inclusion of wood products that are thinner than lumber, during a May 24 meeting with Commerce Department officials.
Late last year, the United States decided to levy final duties averaging 20.23 per cent against most Canadian lumber producers.
A dozen Canadian companies have joined the alliance, which said producers in three provinces were targeted without any warning. The notice from the U.S.
Customs and Border Protection about the new tariffs came 10 weeks after the final duties against Canadian lumber took effect on Jan. 3, the filings show.
"CSS [cedar shakes and shingles] constitute a separate and distinct product and industry," the alliance said in its submission dated June 12, arguing that U.S.
border officials can easily tell the difference between the roofing products and the "subject merchandise" of softwood lumber.
"CSS are easily distinguishable from subject merchandise at the border and cannot feasibly be used in place of, or further manufactured into, subject merchandise."
B.C. Forests Minister Doug Donaldson said the B.C. government backs Canadian producers. "It's outrageous that shakes and shingles are considered by the U.S. to be 'lumber.' We support them in their request to be excluded from the tariffs," Mr.
Donaldson said in a statement to The Globe and Mail on Thursday.
The Reagan administration put a 35per-cent duty on Canadian cedar shakes and shingles in May, 1986. "Actions like this make it extremely difficult for anyone, including Canadians, to be friends with the Americans from time to time," then-prime minister Brian Mulroney said.
Mr. Mulroney's government imposed tariffs a month later on U.S. items including books, computer components and Christmas trees.
The Americans gradually reduced the duties against shakes and shingles, ending them in June, 1991.
Five of the alliance's members are based in British Columbia, four in Quebec and three in New Brunswick. They include Best Quality Cedar Products Ltd. in Maple Ridge, B.C., Fraser Specialty Products Ltd. in Fredericton and Les Bardeaux Lajoie Inc. in Saint-Eusèbe, Que.
"We respectfully submit that CSS are not softwood lumber," the alliance said.
"CSS are a separate and distinct product that is manufactured directly from cedar logs in dedicated mills, using specialized equipment not used in the manufacture of softwood lumber."
The alliance said the U.S. lumber lobby did not list shakes and shingles among its concerns in the dispute. Canadian producers say members of the influential U.S.
group COALITION, which stands for Committee Overseeing Action for Lumber International Trade Investigations or Negotiations, do not even manufacture shakes and shingles.
"Cedar shakes and shingles are specialized, high-end products used on the roof and sides of residential and commercial buildings, to create a desired architectural style," the alliance said in its filing to the Commerce Department.
"We respectfully request that the Department take administrative notice of the fact that past Department investigations involving softwood lumber have expressly identified shakes and shingles as an industry separate from softwood lumber."
The latest cross-border clash over softwood is the fifth round in the fight dating back to 1982.
Canadian companies say their wood shakes and shingles have been unfairly targeted with duties of 20.23 per cent.
JOHN LEHMANN/THE GLOBE AND MAIL