Lumber duty could hurt western producers

Softwood lumber producers in Central Canada will be hardest hit by a new U.S. duty on Canadian exports and some believe western producers could be next as the government seeks new ways to generate cash in the sector.

Softwood lumber producers in Central Canada will be hardest hit by a new U.S. duty on Canadian exports and some believe western producers could be next as the government seeks new ways to generate cash in the sector.

With the United States set to slap a 10 per cent duty on Canadian imports of softwood lumber next week from four provinces — Ontario, Quebec, Manitoba and Saskatchewan — industry players believe the British Columbia and Alberta could be penalized next.

NDP critic Peter Julian said the anti-circumvention clause in the Canada-U.S. softwood lumber agreement provides ammunition for the United States.

“Although it hasn’t been formally filed yet, it’s a matter of time,” said Julian, whose party opposed the deal signed in late 2006.

In particular, he said stumpage rates in B.C. could be a target and the penalty could be in the “hundreds of millions of dollars.”

Rick Jeffery, president and CEO of Coast Forest Products Association, said the American lumber industry has been pointing to the B.C. stumpage system for years as a source of subsidy, something that is not allowed in the softwood deal.

He agreed the recent tax ruling “creates an incentive” for the U.S. government to launch more ligitation, even though stumpage fees are supposed to be covered in the deal.

In Moncton, Prime Minister Stephen Harper said the federal government has offered several ways of resolving the dispute with the Americans, and he’s disappointed the U.S. went ahead with the duty before Ottawa could get an international tribunal decision clarified.

“We should be clear that the tribunal did rule, that Canada is in violation of the (softwood) agreement, we are not disputing that,” Harper told a news conference.

“What’s at issue is what is the appropriate remedy, the appropriate penalty.”

Chris McIver, vice-president of lumber sales at Vancouver-based West Fraser Timber Co. Ltd (TSX:WFT), said while he hasn’t heard or seen anything that says there is another challenge pending, the Americans “continue to look for opportunities.”

“I wouldn’t be surprised if they would look at anything that would generate a penalty,” said McIver.

John Allan, of the Canadian Lumber Trade Alliance, said the United States has complained in the past about timber pricing policies in B.C. and Alberta, but taken no official action.

Just Posted

Rejected Red Deer County cannabis production facility to go to appeal

County’s subdivision and development appeal board hearing set for May 2

Open house on proposed addictions treatment centre to be held at former Red Deer nightclub

Community is invited to learn more about the $2-million project on May 2

Red Deer looks to be creative to attract business downtown

Co-op to close downtown store after 56 years

Family: A potpourri of Easter egg hunts, music and politics

The election is a thing of the past. Albertans have spoken. They… Continue reading

Sri Lankan-Canadians mourn victims of terrorist attack in their homeland

Sri Lankan-Canadians were gathering Monday to mourn those killed in a massive… Continue reading

Residents along Saint John River told to remain on alert as floodwaters rise

FREDERICTON — People who live along New Brunswick’s Saint John River are… Continue reading

Prince Edward Island voters to cast verdict on new electoral system

CHARLOTTETOWN — Canadians are expected to learn late Tuesday whether the cradle… Continue reading

Early, photogenic iceberg raises expectations for Newfoundland’s season

ST. JOHN’S, N.L. — This historic port city welcomed an unexpected early… Continue reading

Captain Ghislaine Landry leads Canada to victory at Kitakyushu Sevens

KITAKYUSHU, Japan — Captain Ghislaine Landry scored with no time remaining and… Continue reading

Marchand scores twice as Bruins force a seventh game with 4-2 win over Leafs

TORONTO — After a flying start in front of a raucous home… Continue reading

Harry and Meghan’s royal baby: Questions asked and answered

LONDON — The time is drawing near for the impending birth of… Continue reading

Most Read