According to weekend reports, the US International Trade Commission determined Friday there is indication of injury from imports of softwood lumber products from Canada. Perhaps the market is sensing that a resolution will ultimately be found in a negotiated, managed trade agreement, but probably not before duties are in place. By May? In the face of the looming threat of retroactive duties, cross-border shipments continue largely unabated as mills and distributors weigh decisions impacting trading activity into February.
Meanwhile, Random Lengths reports word of “sizable inventories in US reloads”. No doubt we’ll soon find out if this is the case. If history is any guide, building mountains of inventory in advance of duties/export taxes/quota is anything but a speculative “no-brainer”. We’ve all seen the movie. Still, dealer demand for lumber in the United States, albeit hand-to-mouth – has been surprisingly buoyant so far this winter. Certainly some items are in abundant supply – on both sides of the border. But in this uncertain environment, over time, it seems any items in tight supply today would become even scarcer when Canadian shipments are eventually constrained.
Meanwhile, the US Department of Commerce investigations continue; the countervailing duty determination is expected February 20, while the preliminary antidumping duty determination is expected May 4.