Massive western Canadian gypsum board (drywall) anti-dumping tariff will have ripple effects throughout the nation

gypsum board

A recent Canadian Border Services Agency (CBSA) decision to impose massive anti-dumping duties on west coast gypsum board will likely have major ripple effects throughout the country, resulting in price increases and potentially severe supply shortages.

The new duties come into effect as the CBSA has started a review of rebar imports from certain countries.

The CBSA ruled on Sept. 6 that dumping – that is a manufacturer selling its product in Canada less than the price in the home market – has occurred “with respect to certain gypsum board originated in or exported from the United States of America, imported into Canada for use or consumption in the provinces of British Columbia, Alberta, Saskatchewan, and Manitoba as well as the Yukon and Northwest Territories.”

The duties are punitive. Gypsum board supplied by CertainTeed Gypsum and Ceiling Manufacturing Inc., is now subject to 125 per cent provisional duty payments; while Georgia-Pacific Gypsum LLC has been slapped with 105.2 per cent duties and United States Gypsum Company, 143.6 per cent. Duties on “all other exporters” (as a percentage of export price) skyrocket to 276.5 per cent.

The new duties arise after CertainTeed, based in Pennsylvania, filed anti-dumping complaints to the Canadian International Trade Tribunal and the CBSA on behalf of its Canadian-owned business, CertainTeed Gypsum Canada.

CertainTeed, which operates a drywall plant in B.C.’s Lower Mainland near Vancouver, claims that Western Canadian companies are importing drywall from the United States at substantially lower-than-market prices and are flooding the market with it, the Nanaimo (BC) News Bulletin has reported.

The publication said that CertainTeed, in an emailed statement, said: “Our actions are meant to stop this practice and bring a level playing field to the Western Canadian marketplace by having all manufacturers conform to the regulatory and legal requirements as prescribed under Canadian law.”

Local drywall distributors in Nanaimo say the tariff could result in an additional $800 to $4,200 on the cost of new homes in the Vancouver Island community.

The consequences of the tariff could have implications for the drywall market in eastern Canada, as well, as western Canadian customers scramble to replace their US supplies with Canadian-manufactured gypsum board. This could result in supply shortages and pressures on prices throughout the country.

Manufacturers affected by the decision can appeal it until Dec. 15, but the duty goes into effect immediately, meaning there will be serious pressures on contractors with fixed price agreements, who budgeted for their work at the lower prices and now have a shocking increase in costs.

“The ripple effect has already started for the Eastern market with some announcement of price increases,” said an eastern Canadian gypsum board distributor. “It is too soon to know how much and all the details but it is a major scramble for the manufacturers. We may find out in one or two weeks.”

Meanwhile, as the industry faces the higher gypsum board costs, the CBSA has started a separate anti-dumping investigation into rebar imported from Belarus, Chinese Taipei, Hong Kong, Japan, Portugal and Spain.

The investigation was initiated in response to a complaint filed by Canadian producers ArcelorMittal Long Products Canada, G.P., Gerdau Ameristeel Corporation and AltaSteel Ltd.

“We appreciate the CBSA’s commitment through this investigation to ensuring that fair trade in imports of rebar will be respected,” Canadian Steel Producers Association (CPSA) president Joseph Galimberti said in a statement. “It is vital for domestic steel producers and their employees that market-based competition in Canada is preserved. This is an important investigation for the 22,000 Canadians employed directly and the 100,000 employed indirectly in steel.”

This is the second investigation into unfairly traded rebar in Canada in the past two years, CSPA said in a news release. A previous investigation into unfairly traded rebar from China, Korea and Turkey resulted in the imposition of duties against these three countries in 2015. It also follows on the heels of the recent decision by the Canadian International Trade Tribunal (CITT) to extend its antidumping and countervailing duty finding on imports of hot-rolled steel sheet and strip fromChina, Brazil, India and Ukraine into Canada.

The CSPA and its member companies believe in fair and effective enforcement of trade remedy laws which support Canada’s ability to quickly respond to dumped and subsidized imports. In light of the increased volume of unfairly traded goods entering the Canadian market, the CSPA views investigations like this one as critical to ensuring our member companies and their employees are able to compete fairly in the global market.

“Our membership will continue to vigorously defend against unfairly traded, dumped and subsidized steel products which may include the initiation of additional trade cases on hot-rolled, cold rolled, coated flat and other steel products,” said Galimberti. “The recent improvements the Government of Canada has made to our trade remedy framework are helpful and we look forward to additional near- term legislative enhancements to address unfair trade in Canada.”

In a report on the anti-dumping investigation, lawyer Brenda Swick of Dickinson Wright PLCC says “this investigation may adversely affect foreign producers and exporters, as well as Canadian importers, distributors, retailers and end-users of rebar.”

“If the CSBA makes a dumping determination and the CITT finds that such dumping is causing material injury to the Canadian industry, anti-dumping duties will be applied to all shipments of rebar for the next five years.”

She advocates that end-users should take measures to protect their interests, including advocating for a ‘no injury’ finding, applying for an exclusion, or requesting a public interest hearing.


Please enter your comment!
Please enter your name here

I accept the Privacy Policy

This site uses Akismet to reduce spam. Learn how your comment data is processed.