Just Politics

[blackcat]

This may affect trading tomorrow for any of you in the sector.

The Trump administration said it will impose a tariff averaging 20 percent on Canadian softwood lumber imports in retaliation for alleged improper subsidies.

Traders believe the action may initially cause lumber futures to jump, which in turn will weigh on shares of homebuilders when trading begins Tuesday. The type of lumber targeted by the tariff is used to build houses.

The Canadian loonie was already falling versus the U.S. dollar in overnight trading.

The action, the culmination of a long-running dispute between the two countries, wasn't totally unexpected as lumber futures have surged already this year in anticipation of a possible escalation of this sort by President Trump and his Commerce Secretary Wilbur Ross.

"I am surprised that the loonie is not getting hit harder," said Brian Kelly of BKCM LLC in an email. "The last time the U.S. imposed tariffs on Canadian lumber was in 2006. Canada responded by tripling its exports to China."

Lumber futures are up more than 20 percent this year as traders bet it may come to this.

Rest of the article here.
http://www.cnbc.com/2017/04/24/trumps-timber-tariff-will-have-a-big-impact-on-lumber-futures-market-housing-stocks.html