Current Conditions

Light Rain

U.S. trade ambassador to meet with Canadian lumber execs before softwood deadline

October 02, 2016 - 7:00 AM

MONTREAL - Canadian softwood lumber executives will meet this week with America's trade ambassador as they brace for the prospect of U.S. tariffs that they say could result in mill closures and layoffs.

U.S. Trade Representative Michael Froman will speak with the Canadian lumber industry in Toronto on Wednesday, days before U.S. producers could start petitioning Washington to impose new duties on Canadian softwood.

"I think it's an opportunity to have direct conversations with an absence of filters and I think that's a good thing," said Susan Yurkovich, president of the B.C. Lumber Trade Council.

She remains hopeful that a deal can be reached to avoid a protracted and costly trade war.

Following a decade of relative stability, the expiry of the 2006 softwood lumber agreement and a one-year standstill period on Oct. 12 is expected to push the U.S. to begin the process of imposing tariffs on Canadian lumber imports.

Few industry observers expect the Americans will budge from their quest for quotas to reduce Canada's share of the U.S. softwood lumber market.

Canada has traditionally accounted for about one-third of the U.S. lumber market, but the U.S. is rumoured to want that to gradually decrease to 22 per cent, said Richard Garneau, CEO of Quebec-based Resolute Forest Products.

"It will be impossible for Canada to accept that," he said.

The possibility of new duties is worrying workers and small rural communities that rely on the forestry sector, said Garneau.

"Obviously, it's going to affect less the urban centres, but I can tell you that rural Canada is going to suffer a lot," he said.

After the expiry of the previous softwood lumber deal in 1996, the U.S. Department of Commerce imposed a 32 per cent export duty, which was reduced to about 27 per cent in 2002 and remained at that level until a new agreement was reached four years later.

Garneau called on Ottawa to provide Canadian lumber producers loan guarantees and funding to offset anticipated legal costs and duties.

"We need assistance to defend ourselves against these abusive methods the U.S. has on trade."

The United Steelworkers union, which represents about 40,000 forestry workers in Canada, said Ottawa should also provide funding to communities, as it did between 2002 and 2005, so workers can transition themselves to other jobs if mills shut down.

Bob Matters, chairman of the union's wood council, said the number of jobs at risk will vary across the country and depend on several factors, including the amount of duties imposed and duration of the trade dispute.

"Most of the players can survive in the short-term," he said. "But if this thing drags out like last time, then it's anybody's guess."

Federal International Trade Minister Chrystia Freeland said the government is prepared to continue negotiations, adding that it's not a foregone conclusion U.S. duties will be charged on Canadian softwood.

"We want and are working towards a good deal for Canadians, but not just any deal," Freeland said last week.

"If we fail to achieve a deal, which I very much hope will not be the case but is certainly a possibility, and if duties are imposed, we are prepared to litigate."

She warned it's been difficult to resolve lumber disputes in the past, and it is even more challenging because of the heightened protectionist environment in the midst of the U.S. presidential election.

Follow @RossMarowits on Twitter.

News from © The Canadian Press, 2016
The Canadian Press

  • Popular kelowna News
  • Comments
  • Warnings about fentanyl-laced marijuana in the Southern Interior
    THOMPSON-OKANAGAN – Fentanyl is being mixed with marijuana here in the Southern Interior, leading the Kamloops ASK Wellness Society to be even more concerned about the rise of deaths related
  • Kelowna Conservation Officers save large buck tangled in volleyball net
    KELOWNA - Conservation Officers reportedly came to the rescue of a large buck that was entangled in a volleyball net, according to a Facebook post by the Conservation Officer Service "D
  • Kamloops senior almost swindled out of $4,800
    KAMLOOPS - Yesterday, a Kamloops senior had a close call with a pair of brazen scam artists. Staff Sgt. Edward Preto says in a release that yesterday, Oct. 21, an elderly woman received a ph
  • Saying goodbye to Kelowna’s perogy king
    KELOWNA – Whether you knew him from the slopes of Big White or his restaurant in downtown Kelowna, you never forgot the first time you tried Cecil’s perogies. Cecil Warwaruk move
  • Crews respond to fire at Kelowna casino
    KELOWNA - This morning, firefighters responded to a minor fire at Chances on Springfield Road. According to a release issued by Dennis Miller of the Kelowna Fire Department, crews received a

View Site in: Desktop | Mobile