Associations Press for Interventions Over Lumber Prices; Concerns Over Aluminum and Steel Persist as Well

In recent years, the commercial construction industry has discussed the viability of timber curtainwall in commercial applications. In August 2020, The Facade Tectonics Institute’s (FTI) 2020 World Congress included a presentation on these systems. David Barber, principal for Arup, explained that timber is an alternative to aluminum in curtainwall framing applications with many benefits from a sustainability point of view. The use of lumber just got more complicated  though, due to rising costs on both sides of the equation. Over the past year, lumber materials have done more than clad highrises, they skyrocketed in price, leaving suppliers, construction firms and representatives of industry associations pleading with government officials to investigate and take action. Meanwhile, those in the aluminum industry have expressed concern over the volatility of pricing.

“Aluminum prices have risen to their highest in more than two years due to increase demand domestically and in Asia resulting in supply-tightening,” says Brent Slaton, national sales coordinator, Keymark Corp.

In late March, a cohort of 36 construction-related organizations, including the Associated General Contractors of America (AGC), sent a letter to U.S. Department of Commerce secretary Gina Raimondo pleading for action, citing statistics showing lumber prices that have more than tripled. Those efforts resumed in recent weeks, and this time they included urging the administration to roll back tariffs and quotas on imported materials, which officials say add to issues of cost and availability.

In a statement issued Friday, Canada’s Minister of Small Business, Export Promotion and International Trade, Mary Ng, suggested that preliminary determinations made by the U.S. Commerce Department (Commerce) will cause further damage.

“The U.S. Department of Commerce’s preliminary results of its second administrative review suggest its intention to significantly increase duties on Canadian softwood lumber later this year,” Ng said. “This is entirely unjustified and will hurt consumers, businesses and workers on both sides of the border,” she added.

Commerce conducts an annual review of anti-dumping and countervailing duty orders, Ng said, which is similar to initial investigations but applies only to specific companies. According to a news release from her office, preliminary results of the second administrative review propose a combined countervailing and anti-dumping duty rate of 18.32%, while the current combined rate is 8.99%.

While officials for various trade groups cite issues stemming from the COVID-19 pandemic and one-time events (such as freezing conditions in Texas in February) for hindering output for some materials, federal policies—particularly those establishing tariffs and quotas on lumber, steel and aluminum—have exacerbated price increases, supply shortages and delivery delays, they suggested. As a result, they’re now urging the Biden administration to end those “import obstacles.” Doing so, they said, will help to free up bottlenecks in supply chains.

“The Biden administration must address these unprecedented lumber and steel costs and broader supply-chain woes or risk undermining the economic recovery,” said Stephen E. Sandherr, AGC’s CEO. “Without tariff relief and other measures, vital construction projects will fall behind schedule or be canceled,” he warned.

“Every industry is being affected by a labor shortage and companies are being forced to increase wages as a result,” says Slaton. “Increased wages, shortages of raw materials, rising transportation and energy costs, and the current economic stimulus plan are all attributing to an out of control rise in prices. Companies are having to pass along these costs as they simply cannot be absorbed.”

Commerce isn’t expected to issue final results of its administrative review until November 2021.

“Our intent is not to raise or lower duties – it is to determine the actual amount of dumping and subsidization that occurred during the period of review, as required under U.S. law. The current market conditions had no effect on our calculations,” said a Commerce department liaison in response to a USGNN question.

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