Russian lumber industry benefiting from Canada-U.S. trade disputeJEN SKERRITT
Bloomberg News
Published Monday, Aug. 21, 2017 7:59AM EDT
Last updated Monday, Aug. 21, 2017 6:41PM EDT
https://www.theglobeandmail.com/report-on-business/us-houses-are-using-more-russian-lumber-thanks-to-canada-spat/article36039527/Russia has emerged as one of the winners from the trade dispute between Canada and the U.S over lumber.
The U.S. is importing more softwood lumber from overseas after it slapped tariffs on Canadian supplies, making them more expensive. Russian shipments are 42 per cent higher so far in 2017, according to U.S. government data.
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“It seems to be that there’s something illogical that we’re not buying the lumber from our neighbors to the north, that we’re buying it from the Russians,” Jerry Howard, chief executive officer of the National Association of Home Builders, said in a telephone interview from Washington. “That’s sort of the looking glass that we’ve gone through and that’s what the market is forcing us to do now.”
The dispute has increased material costs for house builders in the U.S. by 20 per cent, according to Howard. [...]
For the first half of the year, offshore softwood-lumber imports into the U.S. rose 38 per cent, while shipments from Canada declined 1 per cent, said Bloomberg Intelligence analyst Joshua Zaret.
The additional cost of Canadian lumber is not only saddling U.S. consumers with extra costs but threatens to price some of them out of the market, according to Howard. For every $1,000 price increase of a home, 150,000 people are priced out of the market, he said.
“Fewer houses are being built at the moderate price points, and they’re not being built because the cost of lumber puts them out of too much of the consumers’ buying range,” he said.
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