announced plans to impose tariffs on its Northern neighbors' exports of softwood lumber. The U.S. dollar was fetching 1.3552 Canadian dollars (Exchange: USDCAD) at 8:47 a.m. HK/SIN, compared with around C$1.3408 just before the announcement. U.S. Commerce Secretary Wilbur Ross said on Monday that anti-subsidy tariffs averaging around 20 percent would be imposed, affecting $5 billion worth of imports of softwood lumber imports from Canada, Reuters reported. In total, Canada exported around C$8.6 billion (around $6.37 billion) worth of softwood lumber in 2015, according to Canadian government data, which indicated the country was the world's fourth-largest forest product exporter. In 2015, the U.S. imported a total of $325.4 billion in goods and services from Canada. Khoon Goh, senior foreign-exchange strategist at ANZ, said there could be scope for more weakness in the loonie, particularly if it fell below C$1.36 against the dollar. "It's not just the lumber," he said, noting the U.S. administration had also been rumbling about potential tariffs on dairy products. "Any further escalation of this situation between the U.S.
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Meanwhile, dairy production in Canada increases. The U.S. dairy industry argued that the policy violated Nafta by creating incentives for Canadian processors to use local supplies, effectively blocking U.S. dairy exports , and directly causing a glut of U.S. milk supplies. Yet the Canadian dairy industry, in defending its milk reclassification policy, indicated the product was duty-free, quota-free, did not impose any import taxes, and thus did not break any import rules. Trump's advisers are deeply divided over how aggressively to erect trade barriers. This dispute, nevertheless, is oddly bridging traditional party lines and creating an unusual alliance between Trump; New York's Democratic governor, Andrew Cuomo, and its senator, Chuck Schumer;Wisconsin's Republican governor, Scott Walker; and U.S. House Speaker Paul Ryan. Cuomo beseeched Trudeauto develop a national agreement averting a $50 million market loss for New York's dairy industry. Even Schumer, who has a contentious relationship with Trump, tweeted praise forthe president's get-tough approach toCanada. Source: USDA (includes only milk and no byproducts) The U.S. dairy industry has other reasons to be wary.
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