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Boilermakers union critiques CITT drywall response

JOC News Service
Boilermakers union critiques CITT drywall response

CALGARY – The International Brotherhood of Boilermakers has written to Prime Minister Justin Trudeau about the impact of changing drywall tariffs.

The boilermakers stated that should the government accept the recommendations from the Canadian International Trade Tribunal (CITT), the jobs of 120 of its members in Winnipeg and Calgary would be put at risk.

According to the union, the reaction to the tribunal’s recommendations has already resulted in a downshifting in Calgary, which could affect 25 per cent of boilermakers’ members employed there.

Following a complaint of U.S. dumping last year by CertainTeed, duties of up to 276 per cent were put on drywall products. It is the only producer of gypsum board located in Western Canada with three manufacturing facilities located in Vancouver, Calgary and Winnipeg.

While the CITT found evidence drywall was being dumped, a parallel inquiry also found that the high duties were harming Canadian companies. CITT is recommending that duties should be eliminated for six months to help those with fixed-price contracts already in place and then be limited to 43 per cent of the export price.

The tribunal also recommends that monies already collected be used to offset some of the increased costs paid by end-users.

The union claimed in its letter issued earlier this month that CertainTeed Gypsum Canada Inc. plans to reduce the number of shifts at its Calgary plant from four to three.

"U.S. gypsum board producers led by Koch Industries, owners of Georgia Pacific (GP), were selling gypsum board into Western Canada at less than half of the U.S. price," wrote Rob Lauzon, assistant director of the industrial sector operations for the union.

"This is a classic case of dumping by unusually large margins. The tribunal found this to be injurious."

He said the tribunal’s recommendations for the ongoing discipline of injurious dumping are "underwhelming" and that the remedy can be negated through the "jiggery-pokery" transfer pricing systems of multinational corporations.

According to Lauzon, when the Canada Border Services Agency introduced preliminary duties the union’s members were rehired for a full shift at Calgary and an additional shift was introduced at Winnipeg.

Lauzon said CertainTeed’s storage facilities in Calgary are full because the market is flooded with dumped imports.

Lauzon alleged that Georgia Pacific has idled plants at Surrey, B.C. and Edmonton.

"Local drywall supply could be increased if these were re-opened," he wrote.

"Georgia Pacific cannot refuse to re-open its idled plants on one hand and claim short supply on the other. If there was a shortage, it was driven by corporate decisions of those who have chosen to leave Canada and dump from U.S. plants to serve Canadian markets."

However, the union does support some relief to those in fixed-price contracts.

"We support the tribunal’s recommendations for duties collected during the provisional period," reads the union letter.

"This is over, and these imports are in the market. If there are real cases of hardship among contractors with fixed contracts which do not permit them to pass on increased duties — then some form of relief should be provided."

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