Thoughts On Soft Wood Lumber And The US' Role

This week the USA administration announced that softwood lumber imports into the United States from Canada would be subject to new duties ranging anywhere from 3% up to 24%. The highest duties will be primarily against producers here in Western Canada. Within hours many media sources were running headlines reporting a trade war had erupted. Closer to home BC NDP leader John Horgan accused Premier Christy Clark of failing to resolve the matter even though it is entirely an issue of Federal jurisdiction that resides at the feet of the federal Liberal Government to resolve.
 
I mention these things because this is an issue that for some is easy to play partisan politics with as the BC NDP has illustrated. However in reality forestry is a critically important industry not just in our riding of Central Okanagan Similkameen Nicola but in many ridings in British Columbia and let us not forget other regions of Canada. As an example in my riding the largest private sector employers in West Kelowna, Merritt and Princeton are all lumber mills. In the riding immediately south, South Okanagan—West Kootenay represented by NDP MP Richard Cannings, this is also the case and is one of the reasons why MP Cannings recently introduced a private members bill promoting the use of wood in Government related construction projects.
 
In short this is an issue that should be above partisan politics. I mention that resolving the softwood lumber dispute is an area of federal responsibility as it is unfair and inaccurate to suggest that the BC Government, or any provincial Government for that matter, has the ability to resolve the Softwood Lumber dispute. To be clear it should also be pointed out that this is a long term dispute and not a full blown trade war as some are attempting to claim. I believe it is also important to add that the Liberal Government, and in particular our Prime Minister, has shown restraint in not getting involved in USA domestic politics despite that it would be politically convenient to do so. In fact to date I believe most political pundits would agree that our Liberal Government has made considerable effort to work proactively with the new United States administration in several areas.
 
I mention all of these things as I believe that partisan politics and finger pointing will not constructively assist this situation and our combined focus should be on getting an agreement. If we can work together on a united approach we will increase our odds of success. Ultimately this challenge occurs because much of the United States timber is harvested from private land owners who are more successful in driving up revenues then our crown land system used primarily here in Canada.  This in no way suggests that our crown land timber is subsidized, in fact all evidence to date and success at many trade dispute resolution tribunals consistently rule in Canada’s favour.
 
To further complicate this matter when the Canadian dollar exchange rate is factored in at roughly between 74-76 cents USD this in fact becomes a discount that USA lumber producers must compete against. Interestingly enough the USA administrations recently added new duty rates essentially wipe out the currency advantage that works in Canada’s favour essentially meaning that Canadian produced lumber will now arrive in the United States at a similar cost as USA produced lumber. I mention this only to add some perspective from the other side of the border.
 
There is no question both the Federal and many Provincial Governments will employ many strategies to attempt to help mitigate and resolve this issue as quickly as possible. From my perspective I will continue to support all measures that can bring this matter to a resolution as quickly as possible.  I can be reached at Dan.Albas@parl.gc.ca  or toll free at 1-800-665-8711 and welcome your comments and questions on this topic.