Canada to Defend Its Softwood Lumber in Trade Dispute With US

Logs are stacked at Murray Brothers Lumber Company woodlot in Madawaska Ont. on Tuesday

The Canadian government has denied taking actions to prop up the industry to the detriment of the usa industry.

The U.S. International Trade Commission, a bipartisan panel that reviews trade matters, on Thursday voted to confirm that Canadian imports do harm the U.S. lumber industry.

Canada's softwood lumber exports to the USA have fallen since the Americans first imposed new duties earlier this year, but near-record wood prices have meant there has been less pain to the industry than expected. US home builders have also criticized the tariffs, which can boost the price of lumber and raise the cost of building homes.

"As a result of the USITC's affirmative determinations, Commerce will issue antidumping and countervailing duty orders on imports of this product from Canada", a release explaining the ruling said.

The disagreement centers on the fees paid by Canadian lumber mills for timber cut largely from government-owned land.

The dispute is expected to further add to tensions between the USA and Canada, which are in the midst of negotiating, with Mexico, a rewrite of the North American Free Trade Agreement.

US mills applauded the decision.

"The U.S. Lumber Coalition fully supports the enforcement of America's trade laws", said in a statement Jason Brochu, U.S. Lumber Coalition co-chair and co-president of Pleasant River Lumber Company.

The complaints led to the current duties imposed by the U.S. Department of Commerce last spring and verified in November.

That followed the launch by Ottawa last month of a NAFTA trade challenge over the move. Canadian producers paid about $500 million in deposits for the duties thus far, with more to come in 2018 if there is no settlement. Last week, Canada filed a case at the World Trade Organization in response to Commerce's decision to levy the tariffs.

Canada has appealed to global panels in the dispute.

Mr. Verheul said this week some of the proposals put forth by the Trump administration on Nafta are "wholly unworkable".

The U.S. lumber coalition position is that Canada unfairly subsidizes its producers with low stumpage fees for harvesting trees on government land and that Canadian producers are selling wood into the U.S.at lower prices than they sell it at home. Prime Minister Justin Trudeau's Liberal government is also facing pressure from the Trump administration on aircraft exports from Bombardier Inc. and Canadian rules that limit the import of USA milk and dairy products.

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