The political aftermath continues from a U.S. announcement on softwood lumber.
The U.S. Department of Commerce announced April 24 it would assess a duty, called a countervailing duty, on softwood lumber from Canada, citing there are unfair subsidies the Canadian and provincial government allegedly provide to lumber companies.
B.C. Premier Christy Clark was quick to respond, saying she will “continue to press our case and implement our Action Plan on softwood.”
Since then, Clark has reiterated her party’s promise on the campaign trail to protect B.C. jobs and fight for industry, including during a campaign stop in Invermere Sunday, April 30 where she cited lumber sales are now at risk because of the “punishing duties” imposed by the United States.
Of course, Clark was not the only leader to jump on the softwood lumber issue as an election topic.
“It is time for direct and immediate action to defend BC’s interests in the softwood lumber dispute, to ensure a fair deal for British Columbia,” stated BC NDP leader John Horgan.
Horgan expressed his disappointment with the actions taken against Canadian softwood lumber exports, adding he is “equally disappointed that Christy Clark failed to make getting a deal a priority.”
B.C. Green Party leader Andrew Weaver proposed if his party is elected, they would place restrictions on the export of raw logs and remove PST on machinery and equipment for modernization, “so that the value of our forestry industry stays in B.C.”
The tariffs were assigned after the U.S. Department of Commerce investigated five companies, including Canfor, which has a mill in Radium. Preliminary countervailing duties ranging from roughly 3 to 24 per cent for the five companies, with Canfor’s set at 20.26 per cent. The others include Irving, Resolute, Tolko and West Fraser. Remaining companies will be assessed at 19.88 per cent.
Canfor did not release a statement regarding the tariffs nor did they respond to media requests for an interview, leaving the BC Lumber Trade Council to speak on behalf of all lumber producers.
The Canfor mill in Radium employs 170 people. Larry Cowles, United Steelworkers union chairperson, says the branch has been prepared for such an announcement for a while.
“Work just goes on here and I think it will continue to go on,” says Cowles. “I don’t think there’s any need for a great deal of concern.”
He says only about a quarter of Canfor’s business as a whole is in the United States, but could not confirm how much the local mill ships southwards.
Radium Mayor Clara Reinhardt says the announcement is not a surprise.
“It’s certainly been a concern here for Canfor and the government for months now,” Reinhardt said.
Susan Yurkovich, president of the BC Lumber Trade Council, said as much in a teleconference April 25.
“We have had tremendous support from both the federal government and the provincial government on this file,” Yurkovich said. “The challenge is we haven’t really had a willing dance partner on the other side.”
The BC Lumber Trade Council says the duties are completely without merit.
“The allegations made by the U.S. lumber lobby are the same arguments they made in prior rounds of litigation, all of which were rejected and overturned by independent NAFTA panels,” says Yurkovich.
According to industry experts, Canadian mills, including Canfor, should not be hurt in the short term by the countervailing duty.
“The Canadian industry has worked very hard over the last number of years to diversify our markets, including moving a whole lot of our lumber into Asia, particularly China,” says Yurkovich.
However, more than 50 per cent of Canadian softwood still makes its way to the United States.
“In 2015, 59 per cent of British Columbia’s softwood lumber exports went to the U.S.— down from 82 per cent in 2001 thanks to increased exports to overseas markets including China and India,” Clark confirmed in a speech April 25.
B.C. is the largest Canadian exporter of softwood lumber to the U.S., according to the BC Lumber Trade Council. The B.C. forest industry supports approximately 145,000 direct and indirect jobs in the province.
Another decision by the U.S. is expected to be made in June, when they propose to issue preliminary anti-dumping determination—another type of duty the U.S. argues will help offset “unfair” selling practices by Canadian lumber companies.