In the last article, “The Granddaddy of All Canadian-U.S. Trade Disputes is About to Rear Its Ugly Head Again”, Drew Hasselback discusses the recent problems about trade disputes of softwood lumber products between the United States and Canada. The United States and Canada are considered as each other’s largest trading partner today. The dispute has been going on since 1982 and has gone through four iterations (Hasselback, 2014). Because of this trade dispute, Canadian exports of softwood lumber products to the U.S. has shown a case evidence for the dispute settlement mechanism under NAFTA. The main concerns regarding the dispute between Canada and U.S. is due to the disagreement on pricing strategies, economic impacts, and regulations. In addition, Canada
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building industry and homeowners would be affected. Inflation of material costs have resulted in tariffs and limited supplies. Reports show that since the tariffs were imposed in 2002, the price of building materials has been rising at double-digit rates, quadruple the rate of inflation. These increases could add approximately $5,000 to the cost of building an average sized home, and have made 300,000 moderate-income Americans ineligible for home ownership mortgages. The National Association of Home Builders (NAHB) went on record demanding that the U.S. government eliminate the tariffs completely. Disruption of the U.S. market can be catastrophic for Canada’s softwood industry, which ships 70 percent of its lumber production. Threats from suppliers in other countries such as New Zealand, and Chile, have gained a small share of the growing market. Furthermore, the trade relationship both sustain to gain from one another has left negative impacts from this dispute. Although softwood makes up for less than 5 percent of total trade between the United States and Canada, the largest bilateral trade relationship in the world estimates at $1 billion a day between the
building industry and homeowners would be affected. Inflation of material costs have resulted in tariffs and limited supplies. Reports show that since the tariffs were imposed in 2002, the price of building materials has been rising at double-digit rates, quadruple the rate of inflation. These increases could add approximately $5,000 to the cost of building an average sized home, and have made 300,000 moderate-income Americans ineligible for home ownership mortgages. The National Association of Home Builders (NAHB) went on record demanding that the U.S. government eliminate the tariffs completely. Disruption of the U.S. market can be catastrophic for Canada’s softwood industry, which ships 70 percent of its lumber production. Threats from suppliers in other countries such as New Zealand, and Chile, have gained a small share of the growing market. Furthermore, the trade relationship both sustain to gain from one another has left negative impacts from this dispute. Although softwood makes up for less than 5 percent of total trade between the United States and Canada, the largest bilateral trade relationship in the world estimates at $1 billion a day between the