The White House administration on Monday moved to place a tariff of 20% on Canadian softwood lumber escalating an already intense trade dispute between the two neighbor nations.
President Donald Trump announced his decision on the new tariff during a meeting of conservative media outlets on Monday night in the White House. Trump’s comments initially were relayed by people who had been inside the room and then confirmed by an official from his administration.
The Department of Commerce later said it reached a determination and would be imposing countervailing duties that ranged from 3% to 24% for softwood lumber that was imported, with the average being 20%.
One person present in the room on Monday said the president had threatened that the next tariff would be place in diary.
The United States and Canada typically have friendly trade relationships but that has soured recently. Trump had railed against the decision by Canada to change policy on the pricing of its domestic milk to help cover more diary ingredients that has led to lower prices for some products including milk that is ultra-filtered.
Trump called that decision a disgrace that is hurting producers in the U.S. in states such as Wisconsin.
Wilbur Ross the Commerce Secretary said in a prepared statement that it was a bad week for trade relations between the U.S. and Canada and added that this was not the administration’s idea of a Free Trade Agreement properly functioning.
The Canadian government disagrees strongly with the decision by the U.S. to impose such a punitive and unfair duty, said Canadian Minister if Natural Resources Jim Carr and Minister of Foreign Affairs Chrystia Freeland.
The two warned that the action would create a negative effect on families in the U.S. who must now pay more to have their homes built or renovated.
According to the Commerce Department in the U.S., imports of Canadian softwood lumber were valued at over $5.66 billion during 2016.
The threats President Trump made during his presidential campaign and since he took office have started to become reality in certain situations. This tariff is one of those instances, while the threat to tax other products at the border has yet to be implemented due to industry groups voicing a negative opinion.
Trump’s promise to have Mexico pay for the building of the border wall has not yet happened and now it appears the U.S. public will be paying for that.