U.S. home builders fear new tariffs on Canadian softwood lumber could affect home buyers

WASHINGTON (AP) -- U.S. home builders complained the Bush administration's decision to charge stiff duties on a popular type of Canadian lumber will tax U.S. consumers and dampen a housing boom that has been one of the economy's strong points.

"This action threatens the very industry that is leading our economic recovery," said Bobby Rayburn, a home builder from Jackson, Miss., and vice president and treasurer of the National Association of Home Builders.

American lumber producers have alleged that Canada's trade practices overstimulate production there, driving down U.S. prices and harming the U.S. industry.

After completing a yearlong investigation, the Commerce Department determined Friday that Canada subsidizes its industry by charging low fees to log public forests. The department also said Canada allows its industry to illegally "dump" lumber in the United States at artificially low prices.

The agency set two duties totaling 29 percent for most Canadian lumber producers -- a 19.3 percent duty to punish Canada for the subsidies and a second tariff averaging 9.7 percent for dumping. The duties still have to clear a hurdle at the U.S. International Trade Commission before taking effect.

The dumping duty varies by company. Lumber from Canada's four Maritime provinces was excluded from both duties.

The ruling involved softwood lumber, commonly used in home construction. The United States imported $5.7 billion worth from Canada in 2001, about a third of the U.S. supply.