Trump Slaps Tariff On Canadian Lumber, Response to Dairy Tax
Last week, President Donald Trump called Canada’s policy change on dairy a “disgrace” for what it’s done to the farming industry in Wisconsin and criticized the North American Free Trade Agreement.
“What they’ve done to our dairy farm workers is a disgrace. It’s a disgrace,” said Trump.
Then on Tuesday morning he expressed similar sentiments on Twitter.
“Canada has made business for our dairy farmers in Wisconsin and other border states very difficult. We will not stand for this. Watch!” tweeted Trump.
The day prior his administration announced that the U.S. will be slapping new tariffs on softwood lumber coming from Canada.
“We’re going to be putting a 20% tax on softwood lumber coming in — tariff on softwood coming into the United States from Canada,” said Trump, reported Breitbart News.
The Commerce Department announced that the U.S. would impose a “countervailing duty” of between 3-24% on Canadian lumber exporter.
Canada imported roughly $5.66 billion in softwood lumber in 2016, according to the U.S. Commerce Department
Wilbur Ross, U.S. Commerce Secretary, said this would cost the Canadian lumber industry an additional $1 billion.
“Last Monday, it became apparent that Canada intends to effectively cut off the last dairy products being exported from the United States. Today, in a different matter, the Department of Commerce determined a need to impose countervailing duties of roughly one billion dollars on Canadian softwood lumber exports to us,” said Ross in a statement. “This is not our idea of a properly functioning Free Trade Agreement.”
Chuck Schumer, New York Senator, who is often quick to oppose Trump’s policies, supports Trump on this move.
“Been fighting for NY dairy farmers on this. Glad to see @POTUS join our fight to change Canada’s unfair policy that undercuts our farmers,” tweeted Schumer.
The U.S. Dairy industry also issued a statement in support.
“Our federal and state governments cannot abide by Canada’s disregard for its trade commitment to the United States, and its intentional decision to pursue policies that are choking off sales of American-made milk to the detriment of U.S. dairy farmers,” said Tom Vilsack, president and CEO of the US Dairy Export Council, in a statement earlier this month.
Canada rejected the new duty calling it “unfair and punitive.”
“The Government of Canada disagrees strongly with the U.S. Department of Commerce’s decision to impose an unfair and punitive duty,” said Jim Carr, Canada’s Minister of Natural Resources, and Chrystia Freeland, Canada’s Minister of Foreign Affairs, in a joint statement. “The accusations are baseless and unfounded.”
They also threatened to sue, if necessary.
Author’s Note: Canada may not like this, but Trump is keeping his promise to keep America first, even if it means pissing off our largest trading partner. Just because Canada is a close trading partner, doesn’t mean we should let them get away with policy changes that violate our trade agreements, while having detrimental effects on our dairy industry.
Editor’s note: Strategically this is interesting because it puts China and others on notice that Trump is not playing favorites. It moves all future negotiations toward his favor.