MONTREAL – The Conference Board of Canada says U.S. softwood lumber duties will cut $700 million from Canadian exports over two years and result in the reduction of 2,200 jobs.
The board released a report Wednesday that says curtailed exports should lower the industry’s pre-tax profit to $1.1 billion in 2018, down from $1.8 billion last year and $1.4 billion this year, despite growing revenues.
The U.S. government recently imposed preliminary countervailing duties ranging between three and 24 per cent on Canadian softwood lumber exports.
Anti-dumping duties to be announced next month are expected to raise tariffs to about 30 per cent, half of which should be absorbed by Canadian producers.
Michael Burt, director of industrial trends for the board, says that without tariffs, Canadian wood sector employment would grow by 1,000 to reach 93,300 next year, but with the tariffs employment is projected to fall to 91,100.
The board’s report says duties paid at current export levels will cost Canadian producers $1.7 billion a year until a softwood settlement is reached.
The gloomy forecast comes after the Canada industry last year enjoyed its strongest performance since the U.S. housing collapse in 2006, as exports grew 13.5 per cent to reach $13.2 billion.