The status of anti-dumping duties on gypsum board (drywall) imported to western Canada from the U.S. will be decided by a Canadian International Trade Tribunal (CITT) ruling on Thursday, Jan. 4, but the Canadian Border Services Agency in the interim has confirmed its provisional decision that dumping has occurred, confirming anti-dumping duties to as high as 324.1 per cent.
However, there may be relief for contractors who purchased gypsum at a fixed price and for residents of Fort McMurray, as Canadian manufacturer CertainTeed Gypsum has proposed that transitional arrangements be made to prevent hardship and mitigate losses in these circumstances.
The CITT held an inquiry in Edmonton concluding Dec. 8, where representatives of the competing manufacturers, builders, distributors, and CertainTeed explained their circumstances. Drywall distributors across Canada have reported there are supply challenges and higher prices nationwide as a result of the preliminary tariff decision, which caught much of the industry by surprise when it was announced in September.
The anti-dumping provisions confirmed on Dec. 5 affect gypsum board originating in or exported from the U.S. for use or consumption in B.C., Alberta, Saskatchewan and Manitoba as well as in the Yukon and North West Territories. CertainTeed is the only gypsum board manufacturer in Western Canada.
David Lessard, vice-president of Edmonton’s DCL Drywall Inc., told the Edmonton 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 homebuilders 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.
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 homebuyers and business owners alike will eventually have to deal with the impact of increased construction costs … and will suffer as a result.”