Commerce Releases Preliminary Results of the First Administrative Review: The Duties are Likely to Come Down

Commerce published a preliminary assessment rate for Canadian shipments to the US during the First Administrative Review (AR1) from April 28^th 2017 through December 31^st, 2018 (Table 1) as well as the preliminary determination for the new cash deposit rates that will apply to shipments after the completion of the final determination (Table 2).

The preliminary assessment and cash deposit rates may change in the final determination expected to be released on August 6^th, 2020.  In addition, the new cash deposit rates will not be collected until after the final determination is published in the Federal Register which is expected in mid-August.

What does this mean?  Nothing will change until the final determination is made in mid-August: Canadian shipments to the US are still subject to 20.23% duty deposits.  Once the final determination is made on the AR1 period, the new cash deposit rates will be set and once the final determination is published in the Federal Register, Canadian shipments will be subject to the new final cash deposit rates. Given the preliminary rates announced today, it is likely that cash deposits after mid-Augusts will be lower than the rates currently assessed on Canadian shipments.

While the final assessment rate for the AR1 is likely to be lower than the deposit rate on Canadian shipments over the AR1 period, we do not expect the US will refund the cash deposits in excess of the final assessment rate for the AR1 until the trade dispute is resolved.