Twice previously, NAFTA had determined that the domestic lumber industry’s threat of injury allegations were baseless and contrary to law. In each instance, the case was remanded back to the U.S. International Trade Commission (ITC).
In its latest decision, the NAFTA panel indicated that it had grown weary of the ITC’s attempts to prove that U.S. lumber interests were harmed by competition from Canada.
The five-member panel, which consists of three Americans and two Canadians, unanimously concluded that the ITC was “simply unwilling to accept this (NAFTA) panel’s review” and “has consistently ignored the authority of this panel in an effort to preserve its finding of threat of material injury.”
The ITC was ordered “to make a determination consistent with the decision of this panel that the evidence on the record does not support a finding of threat of material injury and to make that determination within 10 days.”
Although it was noted that the U.S. had no new evidence to back claims of injury and that it “would be an exercise in futility” to further review the case, the U.S. still has the option of appealing the ruling to an “extraordinary challenge” committee.
“But that appeal would merely be a delaying tactic,” said Rayburn, who noted that NAFTA’s extraordinary challenge provisions are primarily meant to be used for matters of gross misconduct, for which there is no legitimate claim in this case.
With the price of framing lumber at $473 per 1,000 board feet for the week ending Aug. 27, according to Random Lengths — up more than 40% from the beginning of the year and approaching the all-time high of $519 recorded in 1994 — Rayburn noted that the NAFTA decision could not have come at a better time.
“Rising building material costs, led by lumber, have added $5,000-$7,000 to the cost of constructing an average new home,” he said. “The duties have artificially boosted lumber prices and have helped line the pockets of domestic producers at the expense of U.S. consumers. NAFTA has unambiguously ruled that this case has no merit. Therefore, the Administration should prevent this case from dragging out any further and allow these punitive duties to disappear.”
For more information, e-mail Michael Strauss, or call him at 800-368-5242 x8252.