WASHINGTON – A group representing the U.S. lumber industry and some of its workers on Friday called on authorities to impose duties on Canadian softwood lumber, reigniting a long-standing trade dispute between the two nations.
U.S. producers complain that Canadian lumber is subsidized, and have in the past launched trade challenges that resulted in the United States imposing billions of dollars in tariffs.
In a widely-expected move, the COALITION group petitioned the U.S. Commerce Department and the U.S. International Trade Commission to impose duties to “offset the harm caused to U.S. mills, workers and communities by Canadian softwood lumber production subsidies”.
READ MORE: 5 things to know about Canada’s softwood lumber trade war with US
The most recent round of arguments ended with a 2006 deal that expired in October 2015. Both sides agreed to take no action for a year after that but talks on a new agreement bogged down, leaving the way open for the group to act.
The Canadian government, which rejects the notion of unfair subsidies, said it would vigorously defend the interests of Canadian workers and producers.
In a statement, Canada’s premiers called the U.S. Lumber Coalition’s decision to petition the U.S. government “unfortunate.”
“Canada’s Premiers urged the Canadian and United States (U.S.) governments to move quickly to reach a new softwood lumber agreement that restores the longstanding trade relationship that benefits the economies of both nations,” the group said.
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“These investigations will undermine active negotiations toward a new softwood lumber agreement and create uncertainty for lumber producers, workers and consumers on both sides of the border.
“The imposition of duties that may result from an investigation would not only hurt communities in Canada where forestry is a major economic driver, but also negatively impact the U.S. residential construction industry and aspiring U.S. home buyers, as it will drive up the cost of U.S. homes and dampen the U.S. housing recovery.”
READ MORE: Canada, US vow to continue softwood lumber talks despite deadline expiry
Alberta Agriculture and Forestry Minister Oneil Carlier said the province was not surprised by the move but still deeply disappointed.
“Despite repeated investigation over more than three decades, the U.S. government’s countervailing action has not survived a legal challenge by Canada,” he said.
“The forestry sector is an important contributor to the economy on both sides of the border, employing nearly 20,000 Albertans in more than 70 communities, and generating approximately $600 million in softwood exports to the U.S. from our province.”
Carlier said it is in the best interest of “all parties involved” that a new softwood lumber agreement between the two countries is reached.
“We will stand with our forestry industry and the workers and families it supports. Our government will continue to work with the federal government and our lumber industry partners to advocate on behalf of the Alberta forestry sector and the workers and communities it supports, to defend our industry from potential trade actions.”
Chicago Mercantile Exchange lumber futures rose by their daily price limit of $10 per thousand board feet (tbf) to $334.40, 1 roughly 1-1/2 month high.
With files from Global News
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