Ridgefield Supply company: Tariffs not working
The softwood lumber dispute between the U.S. and Canada stretches back to 1982, but the impact on U.S. lumber suppliers and consumers is at a high point, said the owner and CEO of a local supply company.
Margaret Price of Ridgefield Supply Co. said certain woods have seen a 24 percent price increase over the last 16 months, amounting to an additional $10,000 to build a median-priced home in Connecticut. Softwood, which accounts for about 10 percent of the cost of a home, is priced at nearly an all-time high, Price said.
Since the most recent agreement between the neighboring countries ended, negotiations have come to a standstill and the U.S. has imposed a more than 20 percent duty on lumber coming in from Canada. That duty, or tariff, was enacted in December 2017 by the U.S. Department of Commerce and the U.S. International Trade Commission.
“I would like the senators and representatives to be involved with the discussions on tariffs, along with the current administration,” Price said. “It could all turn in six months if an agreement is reached. Right now, the industry is as volatile as I’ve seen it. It’s difficult to get your hands on materials at the right price.”
U.S. Sen. Chris Murphy, D-Conn., paid a visit to Ridgefield Supply on Tuesday to tour the renovated facility and discuss the tariffs with Price and other RSC employees. He said homes are already expensive in Connecticut without consumers having to pay what amounts to a tax because of the tariffs.
“The tariffs don’t seem to be doing what (President) Trump wants them to do. (Suppliers) don’t seem to be buying more from U.S. companies,” Murphy said. “Tariffs can work but only if they change buyers’ behavior. This trade dispute is not good for the U.S. We have to come to an agreement with Canada. (Trump) is more interested in brow-beating and insulting Canada than making a deal.”
Matthew Corey, Murphy’s Republican opponent in November’s election, did not immediately respond to a request for comment.
Glenn Albee, president of Ridgefield Supply Co., said Canadian companies are at a price advantage from the onset because most of the lumber comes from trees cut on land owned by Canada and therefore the stumpage fees, or the price paid to the land owner, is set by the government, not the market.
Albee said the U.S. would benefit from allowing more timber to be harvested on public lands. Most wood in the U.S. comes from private lands and is subject to market price. The tariffs were designed to offset that disadvantage, but U.S. companies have increased their prices to remain in line with Canadian softwood, he said.
“The tariffs established a high-price ceiling and everyone came up to that ceiling,” Albee said. “If they negotiated a softwood agreement, that would address the issue. It’s time for trade agreements to evolve.”
Price added: “The economics of the tariffs aren’t being effective.”
Price and Albee said cedar and Douglas fir are the primary woods in question as they are grown primarily in Canada and are popular with U.S. home builders. In many cases, wood from Canada is preferred because it can withstand the temperature extremes of New England.
Ridgefield Supply Co. has roots dating back to 1883 as Osborn and Gilbert Lumberyard. Louis Price, Margaret’s father, purchased the company in the early 1950s and it has remained in the family since. RSC employs 47 people.
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