Missouri Distributor Says Tax on Canadian Wood Will Block Species Needed For U.S. Homes

-- 'Stick is not a stick' ITC told; substitution of southern yellow pine

for Canadian spruce-pine-fir won't work

-- Duty that U.S. producers seek would hit U.S. consumers with up to 78

percent 'hidden tax'



Apr 23, 2001, 01:00 ET from American Consumers for Affordable Homes

    WASHINGTON, April 23 /PRNewswire Interactive News Release/ --
 Richard G. Millman, president and owner of four companies including Millman
 Lumber Company, St. Louis, today joined more than 20 home builders and lumber
 dealers from throughout the United States who told the U.S. International
 Trade Commission (ITC) that lumber for house framing is not interchangeable
 and one product cannot be substituted for another if quality is to be
 protected for U.S. consumers.
     Comments were made in testimony against two petitions submitted by the
 Coalition for Fair Lumber Imports, a Washington, D.C.-based lobbying group,
 that, if implemented, would result in a hidden tax on consumers of up to 78
 percent.
     "We buy lumber by species, specifying the dimensions we know will be in
 demand by our customers," Millman told the ITC. "In the market we serve, the
 majority of the lumber used in framing is Canadian spruce-pine-fir. We carry
 some domestic species as well, but home builders prefer Canadian spruce. We
 are concerned a tariff on Canadian imports will be an economic hindrance to
 the home builders and ultimately the home buyer."
     Headquartered in St. Louis, Millman also has operations in Illinois and
 Washington.
     "It's not realistic to suggest that southern yellow pine, produced in the
 United States, can substitute for Canadian spruce-pine-fir for house-framing,"
 said Susan Petniunas, spokesperson for the American Consumers for Affordable
 Homes (ACAH), an alliance of 14 groups representing consumers, home builders
 and lumber dealers prior to the hearing. "It's like comparing apples to
 oranges."
     "The two species of wood have very different properties," Petniunas
 continued, "including strength, resistance to rotting, and warping."
     The proposed duty is likely to encourage lumber users to seek supplies
 from other nations, rather than use lumber produced in the United States,
 according to those testifying.
     "If Canadian lumber becomes very much more expensive for our customers, we
 will have no choice but to turn to European producers for the quality of
 supply to satisfy the demand for whitewoods in framing applications," said
 Stephen P. Conwell, global product merchant, lumber, The Home Depot.
     "Such a price change would not cause our customers to switch to southern
 yellow pine for framing," Conwell continued. "These two species are simply too
 different to be interchangeable."
     Lumber dealers also must respond to the demands of their customers,
 according to testimony and statements presented today by nine lumber dealers
 from across the country.
     "If softwood lumber were a single commodity product, then we could ignore
 the demands of our customers because they would use what we have in stock,"
 said Mike Fritz, president, Rugg Lumber Co., Greenfield, Mass. "In other
 words, if softwood lumber were a single commodity, the species of softwood
 lumber would be interchangeable for use with other species. If we didn't carry
 the species of lumber that builders in our area prefer to use, we would lose
 their business." Fritz is also chair-elect, National Lumber and Building
 Materials Dealers Association.
     Tom Ross, vice president, Gilcrest Jewett Lumber Company (Iowa),
 emphasized that he must supply what his customers demand, and their demands
 can differ even in various parts of a single state. He indicated most of his
 customers would not use southern yellow pine.
     "Nowhere in Iowa is there much of a preference for southern yellow pine in
 dimension lumber," Ross, a past chair of the National Lumber and Building
 Materials Dealers Association, told the ITC. "This is due to the
 characteristics of southern yellow pine, which most carpenters do not like
 using."
     Barry B. Rutenberg, president of Barry Rutenberg Homes in Gainesville,
 Fla., and immediate past president of the Florida Home Builders Association,
 echoed the "non-substitutability" argument from the builders' standpoint.
     "I select lumber for use in the homes I build based on a performance
 preference," Rutenberg told the ITC. "When I place an order for the lumber I
 need to build a home, I do not ask my lumber dealer for whatever species he
 happens to have at the best price at the time. I ask specifically-by species-
 for the needed quantity in each dimension.
     "I would not use southern yellow pine fir for framing walls in the houses
 I build, even if it cost half as much as spruce-pine-fir," Rutenberg
 continued. "My preference for framing is based on the better performance I
 know I will get from spruce-pine-fir."
     Five home builders with businesses in nearly all states in the U.S.
 submitted statements to the ITC, each emphasizing that southern yellow pine is
 not substitutable for spruce-pine-fir in their regions of the country.
     The petitions would also have a negative impact on other industries such
 as sleep products.
     "We have very specific requirements for the wood products used in
 manufacturing bedframes," said Carlene Evenson, vice president of operations
 for Restonic Mattress Corporation. "A box spring in a frame on a bed must fit
 within very tight tolerances. During my 11 years in the industry, the standard
 for bedframe lumber has always been to require Canadian spruce-pine-fir. The
 reason for this absolute requirement for spruce-pine-fir is that it meets the
 various tolerances we have in terms of exact size, moisture content, and, in
 particular, degree of warping and cupping."
     In addition to the fact that southern yellow pine cannot be substituted
 for Canadian lumber, the Coalition's petitions would have severe negative
 impacts on U.S. consumers, workers and the national economy, according to
 Petniunas. She indicated that two days after the U.S./Canada Softwood Lumber
 Agreement of 1996 (SLA) expired, the coalition of lumber producers submitted a
 countervailing duty petition for an approximate 40 percent duty and an anti-
 dumping duty between 28 and 38 percent, a duty she calls "ludicrous."
     She said that a 78 percent duty added to the price of softwood lumber from
 Canada could add approximately $2,000 to $4,000 to the price of a new home. As
 many as 1.2 million American families could be unable to purchase a new home,
 leading to a reduction in the number of housing starts in the U.S. and injury
 to the U.S. economy.
 
                     MAKE YOUR OPINION COUNT -- Click Here
                http://tbutton.prnewswire.com/prn/11690X33778377
 
 

SOURCE American Consumers for Affordable Homes
    WASHINGTON, April 23 /PRNewswire Interactive News Release/ --
 Richard G. Millman, president and owner of four companies including Millman
 Lumber Company, St. Louis, today joined more than 20 home builders and lumber
 dealers from throughout the United States who told the U.S. International
 Trade Commission (ITC) that lumber for house framing is not interchangeable
 and one product cannot be substituted for another if quality is to be
 protected for U.S. consumers.
     Comments were made in testimony against two petitions submitted by the
 Coalition for Fair Lumber Imports, a Washington, D.C.-based lobbying group,
 that, if implemented, would result in a hidden tax on consumers of up to 78
 percent.
     "We buy lumber by species, specifying the dimensions we know will be in
 demand by our customers," Millman told the ITC. "In the market we serve, the
 majority of the lumber used in framing is Canadian spruce-pine-fir. We carry
 some domestic species as well, but home builders prefer Canadian spruce. We
 are concerned a tariff on Canadian imports will be an economic hindrance to
 the home builders and ultimately the home buyer."
     Headquartered in St. Louis, Millman also has operations in Illinois and
 Washington.
     "It's not realistic to suggest that southern yellow pine, produced in the
 United States, can substitute for Canadian spruce-pine-fir for house-framing,"
 said Susan Petniunas, spokesperson for the American Consumers for Affordable
 Homes (ACAH), an alliance of 14 groups representing consumers, home builders
 and lumber dealers prior to the hearing. "It's like comparing apples to
 oranges."
     "The two species of wood have very different properties," Petniunas
 continued, "including strength, resistance to rotting, and warping."
     The proposed duty is likely to encourage lumber users to seek supplies
 from other nations, rather than use lumber produced in the United States,
 according to those testifying.
     "If Canadian lumber becomes very much more expensive for our customers, we
 will have no choice but to turn to European producers for the quality of
 supply to satisfy the demand for whitewoods in framing applications," said
 Stephen P. Conwell, global product merchant, lumber, The Home Depot.
     "Such a price change would not cause our customers to switch to southern
 yellow pine for framing," Conwell continued. "These two species are simply too
 different to be interchangeable."
     Lumber dealers also must respond to the demands of their customers,
 according to testimony and statements presented today by nine lumber dealers
 from across the country.
     "If softwood lumber were a single commodity product, then we could ignore
 the demands of our customers because they would use what we have in stock,"
 said Mike Fritz, president, Rugg Lumber Co., Greenfield, Mass. "In other
 words, if softwood lumber were a single commodity, the species of softwood
 lumber would be interchangeable for use with other species. If we didn't carry
 the species of lumber that builders in our area prefer to use, we would lose
 their business." Fritz is also chair-elect, National Lumber and Building
 Materials Dealers Association.
     Tom Ross, vice president, Gilcrest Jewett Lumber Company (Iowa),
 emphasized that he must supply what his customers demand, and their demands
 can differ even in various parts of a single state. He indicated most of his
 customers would not use southern yellow pine.
     "Nowhere in Iowa is there much of a preference for southern yellow pine in
 dimension lumber," Ross, a past chair of the National Lumber and Building
 Materials Dealers Association, told the ITC. "This is due to the
 characteristics of southern yellow pine, which most carpenters do not like
 using."
     Barry B. Rutenberg, president of Barry Rutenberg Homes in Gainesville,
 Fla., and immediate past president of the Florida Home Builders Association,
 echoed the "non-substitutability" argument from the builders' standpoint.
     "I select lumber for use in the homes I build based on a performance
 preference," Rutenberg told the ITC. "When I place an order for the lumber I
 need to build a home, I do not ask my lumber dealer for whatever species he
 happens to have at the best price at the time. I ask specifically-by species-
 for the needed quantity in each dimension.
     "I would not use southern yellow pine fir for framing walls in the houses
 I build, even if it cost half as much as spruce-pine-fir," Rutenberg
 continued. "My preference for framing is based on the better performance I
 know I will get from spruce-pine-fir."
     Five home builders with businesses in nearly all states in the U.S.
 submitted statements to the ITC, each emphasizing that southern yellow pine is
 not substitutable for spruce-pine-fir in their regions of the country.
     The petitions would also have a negative impact on other industries such
 as sleep products.
     "We have very specific requirements for the wood products used in
 manufacturing bedframes," said Carlene Evenson, vice president of operations
 for Restonic Mattress Corporation. "A box spring in a frame on a bed must fit
 within very tight tolerances. During my 11 years in the industry, the standard
 for bedframe lumber has always been to require Canadian spruce-pine-fir. The
 reason for this absolute requirement for spruce-pine-fir is that it meets the
 various tolerances we have in terms of exact size, moisture content, and, in
 particular, degree of warping and cupping."
     In addition to the fact that southern yellow pine cannot be substituted
 for Canadian lumber, the Coalition's petitions would have severe negative
 impacts on U.S. consumers, workers and the national economy, according to
 Petniunas. She indicated that two days after the U.S./Canada Softwood Lumber
 Agreement of 1996 (SLA) expired, the coalition of lumber producers submitted a
 countervailing duty petition for an approximate 40 percent duty and an anti-
 dumping duty between 28 and 38 percent, a duty she calls "ludicrous."
     She said that a 78 percent duty added to the price of softwood lumber from
 Canada could add approximately $2,000 to $4,000 to the price of a new home. As
 many as 1.2 million American families could be unable to purchase a new home,
 leading to a reduction in the number of housing starts in the U.S. and injury
 to the U.S. economy.
 
                     MAKE YOUR OPINION COUNT -- Click Here
                http://tbutton.prnewswire.com/prn/11690X33778377
 
 SOURCE  American Consumers for Affordable Homes