Gypsum board anti-dumping review hearing concludes as industry adjusts to higher costs

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Final arguments have started in a hearing on whether to continue a controversial drywall tariff one Edmonton contractor says has cost his company almost $35,000, the Edmonton Journal reports.

The building supply and home building industries were stunned by the scale of the preliminary anti-dumping gypsum board tariffs imposed on Sep. 8 following a complaint by manufacturer CertainTeed Gypsum Canada Inc. 

The duties in some cases are 324 per cent. CertainTeed said that US competitors were dumping drywall into western Canada at prices significantly below what they charged at home, making it impossible to compete.

David Lessard, vice-president of Edmonton’s DCL Drywall Inc., told the Journal that the industry wasn’t consulted about the tariff, which boosted drywall costs by 30 per cent, including products the company agreed to supply for jobs but hadn’t purchased yet.

“I can tell you that we have been paying most of that 30-per-cent increase. There’s been small percentages that suppliers have agreed to take, and we had to go to home builders to try to pass on some (of it).”

On an average 200 sq. m. bungalow, with about 630 sq. m. of drywall, the price increase will add approximately $600 to the cost of a home, Lessard said.

“We have yet to lay off anyone because of this; however, it’s not a sustainable situation,” Lessard said.

The hearing is scheduled to finish today (Dec. 8).

In an earlier session, CertainTeed lawyer Michael Milne argued evidence shows the company has lost customers because it’s “out of the game” on prices.

The company said that Fort McMurray builders should receive an exemption from the tariff, while contractors with multi-month contracts that include drywall prices set before duties were imposed should get a partial refund.

The Western Canada Alliance of Wall and Ceiling Contractors contended in a written submission that the tariff isn’t causing significant harm to CertainTeed.

The group agrees that if a duty is imposed, the terms should include refunds for drywall bought for Fort McMurray or to fulfil contracts in place before September.

However, it argues a tariff would be contrary to Canada’s economic, trade or commercial interests.

One member has indicated it’s aware of housing projects put on hold or cancelled because of the new rules, the alliance says.

“Faced already with housing and real estate markets with significant headwinds, there is no doubt that home buyers and business owners alike will eventually have to deal with the impact of increased construction costs … and will suffer as a result.”

The three-member tribunal is scheduled to reach its decision Jan. 4.

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