New Brunswick Premier Brian Gallant says the province plans to “fight back with facts,” alongside its counterparts across the country, against the proposed tariff on softwood lumber going into the U.S. from Canada.
On Monday, President Donald Trump told reporters to expect a 20 per cent tariff on the Canadian export. U.S. trade secretary Wilbur Ross confirmed the number while speaking with Reuters.
Gallant said Tuesday it would be “difficult to comment,” as there could be other parts of the decision and they were reacting to a “leaked” decision. But he said they’ll be working with the federal government and their counterparts to ensure American governors, decision makers, the private sector and U.S. residents themselves, “recognize that robust trade with Canada is important to their economy.”
“We are, as a government, going to work very hard with our counterparts across the country to make sure that we speak with a very strong voice to the American industry and to the Trump administration,” Gallant told reporters.
“New Brunswick has the economy that depends the most on trade in Canada. New Brunswick is also the economy that depends the most on trade specifically with the United States.”
He said the government’s thoughts are with businesses, communities and workers that depend on the forestry sector.
A fact sheet from the Commerce Department about the pending announcement seen by Reuters shows West Fraser Mills will pay the highest duties at 24.12 per cent, while J.D. Irving Ltd. (JDI) – a New Brunswick business – would pay 3.02 per cent.
All other Canadian producers face a 19.88 per cent duty, according to the statement.
Overall impact on industry
Jerome Pelletier, vice president of JDI’s sawmill division, told Global News that though the subsidy won’t affect their company too much, the tariff will still have an overall impact on the industry.
“The forest industry in New Brunswick is interconnected,” he said. “When you look at the value stream, you start with the loggers, the truckers, the sawmills, and then the sawmills provide boards to remand operations to pallet manufacturers.”
A statement was also released from Forest NB on behalf of New Brunswick Lumber Producers regarding the countervailing duties – a type of import tax meant to counter a subsidized export – on lumber.
The organization said the duty is “very tough news” and said it’s not only difficult for mills but for the communities.
They said the 3.02 per cent duty for JDI “proves the case for all New Brunswick softwood lumber producers.”
“We want Ottawa to start negotiations immediately,” the statement reads. “Our mills and communities cannot afford prolonged delays.
“We are calling on a unified approach by all federal and provincial elected officials to support our mill communities and stand up for the historic Maritime exclusion which has existed for over 35 years.”
The statement also says more than 4,100 direct and indirect jobs in rural parts of the province depend on the sawmills.
‘Canada has always been on the right side of this’
Asked about JDI being singled out, Gallant said it demonstrates that New Brunswick businesses aren’t being subsidized.
“It demonstrates that across the country – I can’t speak specifically to other provinces – but it would give us the impression that the allegations coming from the U.S. are unfounded and there’s no subsidies happening across the country either,” Gallant said.
Though there is still a small subsidy JDI is facing, the premier referenced Canada’s history of softwood lumber disputes. According to a joint statement to Global News, Natural Resources Minister Jim Carr and Foreign Affairs Minister Chrystia Freeland said international tribunals have disproved “the unfounded subsidy and injury allegations from the U.S. industry.”
“Canada has always been on the right side of this,” Gallant told reporters. “So I think it demonstrates that when they’re trying to rev up some of the tariffs on other businesses, they couldn’t even get to the point that they would rev it up as much as JDI because in fact, New Brunswick does not subsidize the industry.”
“We’ll ultimately win,” in terms of challenging a potential tariff, Gallant said, adding that it’s going to be a challenge for the next several months, and that the government would support the businesses, communities and people affected, including helping long-term businesses open up new markets.
Gallant reiterated, however, that it’s unknown exactly what the government will be able to do, as much is being based off early reports.
“We haven’t even gotten the full decision, but certainly there’s a willingness… from both levels of government to work together to do everything we can to help the people that will be affected by this decision,” he said.
– With files from Kevin Nielsen and Andrew Cromwell, Global News, Andrew Russell, Reuters, and The Canadian Press