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Cold comfort from U.S. softwood lumber decision, B.C. industry says

Canadian producers keep paying in 91ƵGroundhog Day91Ƶ dispute
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Tolko91Ƶs Soda Creek sawmill at Williams Lake is one of many in B.C. that have reduced production or shut down in the past year. (Black Press files)

A preliminary decision to reduce steep border tariffs on Canadian lumber imports is a step in the right direction, but a long way from relief for the struggling B.C. industry, the B.C. Council of Forest Industries says.

A preliminary finding by the U.S. Commerce Department on the long-running trade dispute could cut the border duties by half, but that won91Ƶt be clear until a final adjudication in August, COFI president Susan Yurkovich said Wednesday.

And the ruling is for 91Ƶadministrative review one,91Ƶ a period ending in 2019 when the North American lumber industry was making its highest returns ever. 91ƵAdministrative review two91Ƶ began on Jan. 1, and could result in further penalties on Canada91Ƶs producers.

91ƵIt91Ƶs Groundhog Day,91Ƶ Yurkovich said of the continuing claims of 91Ƶdumping91Ƶ and 91Ƶinjury91Ƶ coming from U.S. producers. 91ƵWe continue to keep fighting but it91Ƶs a very long process and it doesn91Ƶt provide immediate relief to our industry.91Ƶ

The heaviest import duties fall on B.C.-based companies, with West Fraser facing a total of more than 23 per cent. Tolko is penalized 22 per cent and Canfor duties total more than 20 per cent, combining countervailing and anti-dumping penalties.

The latest finding has one glimmer of hope for B.C., Yurkovich said.

91ƵThe one positive is that they91Ƶre finally starting to recognize that there might be a difference for beetle-killed wood,91Ƶ she said. 91ƵThey had never recognized that before and they didn91Ƶt include any provision for that.91Ƶ

The U.S. Lumber Coalition issued indicating it is undeterred by the preliminary finding, and applauding the continued investigation.

91ƵThe U.S. softwood lumber industry is pleased that the U.S. government is fully enforcing our trade laws,91Ƶ said Jason Brochu, co-chair of the U.S. coalition. 91ƵCanada91Ƶs massive subsidies to their lumber industry have caused real harm to U.S. producers and workers. The U.S. lumber industry will continue to push for the full enforcement of the U.S. trade laws during this ongoing process.91Ƶ

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Another decision is expected from Canada91Ƶs appeal to the World Trade Organization, which held two hearings in 2019. The WTO has ruled in Canada91Ƶs favour in previous rounds, on U.S. claims that buying Crown-owned timber represents an unfair subsidy to Canadian construction materials.

The first round was in 1982, and the fifth remains in place in 2020.

In the meantime, companies continue to pay penalties into a U.S. government fund.

91ƵWhen all of the appeals are exhausted and all of the administrative reviews are completed, in theory those cash deposits are refunded to the companies,91Ƶ Yurkovich said. 91ƵIt91Ƶs their business strategy. Harm your competitors rather than getting more efficient or focusing on growing the market.91Ƶ



tfletcher@blackpress.ca

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