Canadian lumber exports over the year through to February amounted to $16-billion Canadian, which is a level not seen since 2006 as an expired agreement in October 2015 gave producers open access to the U.S. markets.
Unfortunately, that trend may be coming to an end this week as the U.S. Department of Commerce is expected to levy duties on Canadian lumber as early as Tuesday, and Bank of Montreal estimates it will be in the ball park of 20 to 30 per cent.
Another issue through U.S. lenses is the idea of dumping when Canadian lumber is sold below the production cost in the U.S.
As a result, additional anti-dumping duties are expected in the months ahead.
Last time Canadian lumber was slapped with these types of duties was back in 2001 and exports fell off 12 per cent over two years.
For the Bank of Canada Governor, it’s a reason for caution.
Particularly because the lumber industry is such a big job provider for the Canadian economy, especially here in British Columbia.