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Canadian Softwood Lumber Imports
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Canadian Softwood Lumber Imports

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SENATORS URGE ITC TO GIVE SOFTWOOD LUMBER INDUSTRY SOME RELIEF|September 12, 2017
A slate of senators headed to the International Trade Commission this morning to make their voices heard in a long-simmering trade case involving imports of softwood lumber from Canada, which domestic producers argue is hurting U.S. industry and contributing to a loss of American jobs. Sen. Ron Wyden, whose home state of Oregon is a major lumber producer, will urge the panel to issue an affirmative recommendation in the case.

"Bottom line, it is critical that this Commission tackle the impacts of unfair trade on U.S. industries, including the lumber industry — not just when companies are on the verge of bankruptcy, not just in down markets, but whenever the evidence demonstrates that companies are harmed by unfairly traded imports," Wyden, the top Democrat on the Senate Finance Committee. "American timber producers and millworkers deserve nothing less."

Sens. Jon Tester (D-Mont.), Roger Wicker (R-Miss.) and Steve Daines (R-Mont.) will join Wyden in testifying before the panel. Tester, citing stories he's heard from his constituents, will urge the ITC to "immediately deploy" U.S. trade enforcement tools, warning that "our mills and our economy simply cannot afford to wait any longer."

FLA Meets with Key Senators Ahead of ITC Hearing |September 8, 2017
FLA has been working on Canadian Lumber Imports and the renewal of a Softwood Lumber Agreement with Canada that will offer landowners certainty in their ability to count on strong markets for saw timber. In preparation of the ITC hearing and in response to Secretary Ross’s postponed decision on duties, FLA CEO, Scott Jones met with two key Senators to emphasis the importance of negotiating a clean quota deal and the economic impact that the delay in a final agreement is having on lumber markets.

Senator Wicker (R-MS). FLA met with Sen. Wicker’s staff trade attorney to provide prospective of the economic harm the unresolved Softwood Lumber Agreement is causing in preparation of Wicker’s testimony delivered at the ITC hearing on Tuesday, September 12.

FLA and many of our members from Mississippi sent a letter to Senator Wicker thanking him for delivering testimony.

Senator Wyden (D-OR): FLA also met with Elissa Alben, Senior Trade and Competitiveness Counsel, who holds a law degree from Columbia University and an undergraduate degree from Harvard. She was well-versed in the issue with an in-depth knowledge and understanding of how timber producers and mills are being impacted by the unfair trading practices.

Wyden and Crapo (R-ID) have been leaders in the Senate on this issue for many years and led the most recent letter to the Department of Commerce urging them to negotiate an agreement.

Both Senator’s offices expressed the importance of grassroots to keep pressure from Congress on Commerce to consultant with them on an agreement. FLA will is compiling a Call to Engage and will be sending it to forest landowners and mills.

Department of Commerce: Meeting with Peter Krug, Associate Director of Intergovernmental Affairs. Discussion focused on the importance of the Administration and Department of Commerce negotiating for a Clean Quota and how the delay on duties impacts the US lumber industry. It was stated that the the delay in duties was done as a sign of good faith to negotiate the best deal for the US timber producers and mills. FLA stressed a clean quota and a long-term deal at 29% for one year and 28% for the remainder of the agreement.

The US lumber industry and their allies maintain that Canadian Provincial and Federal governments subsidize Canadian lumber manufacturers by allocating timber at artificially low prices. Many other subsidies are alleged. The US industry goal is open and competitive markets across Canada.

Why It’s Important

Subsidized lumber imports put US manufacturers at a competitive disadvantage, depress lumber pricing, and adversely affects timberland values. Low cost timber combined with grants, subsidized loans, and loan guarantees create artificially low production costs for Canadian lumber producers.

Our Position

FLA agrees that Canadian stumpage is subsidized. We believe in basing timber sales on free market mechanisms, not government allocation. Our government should actively enforce the SLA.

FLA supports the SLA as long as the US government enforces against any attempt to violate the agreement by Canadian federal or provincial governments.

Background

U.S. lumber producers are at an unfair competitive disadvantage in the domestic market against Canadian lumber producers because of Canada’s timber pricing policies. This has resulted in five major disputes (so called lumber wars) between the United States and Canada since the 1980s.

The current dispute (Lumber V) started when the 2006 Softwood Lumber Agreement (SLA) expired on October 12, 2015. Under that agreement, Canadian softwood lumber shipped to the United States was subject to export charges and quota limitations when the price of U.S. softwood products fell below a certain level. After a yearlong grace period, a coalition of U.S. lumber producers filed trade remedy petitions on November 25, 2016, which claim that Canadian firms dump lumber in the U.S. market and that Canadian provincial forestry policies subsidize Canadian lumber production.


In a preliminary determination on April 24, 2017, the ITA determined that the Canadian industry was subsidized and then imposed preliminary countervailing duties upward of 20% on Canadian lumber. Final determinations were due by September 14th, but Department of Commerce Secretary Ross postponed the determinations until mid-November.

 

 

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