Commerce Erred in Dumping Calculation on Canadian Softwood Lumber, Exporter Says in CIT Complaint

The Commerce Department unlawfully chose to include sales of wood chips in its calculation of market value and incorrectly found that one of Canfor's sawmills purchased electricity from an affiliate, the Canadian softwood lumber exporter said in its Oct. 2 complaint at the Court of International Trade. The department's use of a differential pricing method also was unlawful, the exporter said in its request for remand (Canfor Corporation v. U.S., CIT # 23-00188).

Canfor is challenging parts of the final results of the administrative review of the antidumping duty order on certain softwood lumber products from Canada in 2021, in which it was selected as one of two mandatory respondents and was hit with a dumping margin of 5.25%.

During the period of review, Canfor said it was obligated to sell all of the wood chips produced at two of its sawmills because it was locked into a long-term supply agreement at prices that didn't represent the then-current market value. Those prices shouldn't have been used in a comparison with Canfor’s sales of wood chips to affiliated pulp mills for purposes of Commerce’s analysis of affiliated party transactions because they were unrepresentative, the exporter said.

Commerce shouldn't have adjusted Canfor's reported cost of electricity at the Prince George sawmill because the record "clearly showed" that electric power was supplied by an unaffiliated utility, Canfor said. Electricity was provided by BC Hydro, the electric power company in British Columbia, rather than an affiliated entity.

Finally, Canfor challenged Commerce's use of a differential pricing methodology, saying the practice was contrary to law because the department used the average-to-transaction comparison methodology to determine Canfor’s dumping margin. That methodology was based on Commerce's use of the Cohen’s d test statistical analysis, which Canfor argued that the U.S. Court of Appeals for the Federal Circuit "confirmed to be legally flawed."