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Here's Allan Robinson's At The Bell which you'll find in Tuesday's newspaper: The cost squeeze is on U.S. manufacturers and consumers and that will be evident today with the release of the import prices, which are soaring. Everyone knows oil, food, fertilizer and metal prices are at lofty levels, but now, in the midst of the U.S. housing crisis, even the depressed lumber market is starting to show some signs of life. WHAT ARE THE EXPECTATIONS? Over all, import prices are forecast to have increased 1.6 per cent in April, compared with 2.8 per cent in March, according to a survey of economists by Bloomberg. On a year-over-year basis, however, import prices are expected to be up 15 per cent in April, compared with 14.8 per cent a month earlier. And don't take comfort in the lower pace of rising prices in April. It just so happened that crude oil and metals were down sharply during the survey period, according to Merrill Lynch & Co. Inc. "The moderate increase in April is expected to be fully reversed in May as commodity prices rocketed to new highs," it said. "Just the runup in energy prices since the first quarter will cost U.S. consumers more than $100-billion (U.S.) annually - gobbling up the tax rebates," said Douglas Porter, deputy chief economist with BMO Nesbitt Burns Inc., in a report to clients. In U.S. dollar terms, oil prices have doubled in a year, while prices are up 75 per cent in euro-dollar terms and 83 per cent in Canadian dollars, he said. And the commodity boom might just be expanding to include lumber, which would help Canadian producers like International Forest Products Ltd. and Canfor Corp. "While the market is being told that the housing industry in the U.S. is virtually on life support and will be for quite a while before the inventory of unsold homes is reduced, the lumber futures market has risen 24 per cent since the middle of March, indicating that the demand for wood is increasing," said Robert Tebbutt, vice-president of risk management for Peregrine Financial Group Canada Inc. Lumber recently traded at about $233 (U.S.) for 1,000 board feet, up from a low of $185.70 in March, and lumber futures remain at a premium to the spot price, indicating an increased demand for lumber, Mr. Tebbutt said. "These prices have to move up quite a bit to move back into profitability," cautions Patricia Mohr, vice-president of industry and commodity research for Bank of Nova Scotia.

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