> -----Original Message-----
> From:	Reid Carter [SMTP:Reid.Carter@NBFinancial.com]
> Sent:	Wednesday, October 31, 2001 1:16 PM
> Subject:	Anti-dumping duties to range from 5.94% to 19.24% - Average
> is 12 .58%
> 
> Our View on today's release of anti-dumping duties by the US Department of
> Commerce. We continue to be underweight lumber producers, although we also
> view West Fraser as the best value opportunity in the sector.
> 
> Anti-dumping duties to range from 5.94% to 19.24% - Average is 12.58%. It
> is
> important to note that these are preliminary anti-dumping duties and
> likely
> contain many mistakes. The 19.24% duty applied to Slocan, in particular
> will
> likely be subject to significant downward revision. 
> A preliminary anti-dumping duty of 12.6% will be assessed against lumber
> shipments from Canada to the U.S., the Department of Commerce announced
> today.  The anti-dumping duty, which will affect all Canadian producers,
> including those in the Maritime provinces, will go into effect upon
> publication in the Federal Register, which usually occurs 3-7 days after
> the
> ruling.  At that time, bonds or cash deposits will be required to cover
> shipments from Canada to the U.S.  It will not be retroactive.
> 
> Slocan Sees Biggest Duty, West Fraser the Lowest.
> The investigation focused on charges that Canadian producers sold lumber
> into the U.S. at prices that were below their production costs.  Six large
> companies were investigated, with each assessed an individual anti-dumping
> duty.  Those investigated, and their duties were: Weyerhaeuser (11.93%),
> Canfor (12.98%), Slocan (19.24%), Abitibi-Consolidated (13.64%), Tembec
> (10.76%), and West Fraser (5.9%).  All other Canadian companies will be
> assessed an anti-dumping duty of 12.6%, which is the weighted average of
> the
> six investigated.
> 
> Duties are Now 31.9%
> The anti-dumping duty will be added to the 19.3% preliminary
> countervailing
> duty, which was assessed in August, for a total duty of 31.9%.  Maritime
> provinces are exempt from the CVD. The bonding requirements for the
> current
> 19.3% CVD will end Dec. 17th. Until then, Canadian lumber exporters to the
> US will face the 31.9% duty.
> 
> Lumber Producers Not Expected to Accrue Anti-dumping Liabilities
> We believe most Canadian lumber producers will not book duties imposed as
> a
> result of the preliminary anti-dumping findings by the DoC. This is
> because
> these "preliminary duties" are likely to be significantly revised before
> any
> cash payments are necessary. Final anti-dumping duties will be determined
> by
> the export pricing practices of Canadian lumber producers for the period
> after the "Final" Determination, expected in May 2002, and the "First
> Administrative Review" date, one year later, in the spring of 2003.
> Canadian
> lumber producers should be able to positively influence the outcome of
> these
> final duties by not selling low-grade products into the US. 
> 
> Outlook Remains Negative
> We expect to see considerable confusion and uncertainty over both the CVD
> and anti-dumping duties and their expected impact on Canadian lumber
> producer's earnings going forward. We continue to recommend a very much
> underweight position in Canadian lumber producers going forward, despite
> the
> recent weakness in their shares. This recommendation is driven by our
> expectation of a significant decline in lumber demand through early 2003
> with very soft pricing before the imposition of any countervailing or
> anti-dumping duties
> 
> 
> 
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