Ottawa to challenge lower but still ‘unfounded’ US tariffs on softwood lumber, says Ng

Lower-than-expected US sanctions on Canada’s softwood lumber exports are doing little to assuage the federal government’s dismay in Ottawa.

International Trade Minister Mary Ng called the latest tariffs “unfounded”, “unjustified” and “unfair”.

The key final rate of 8.59 percent is significantly lower than the current rate of 17.91 percent, as well as the 11.64 percent proposed in a preliminary decision issued earlier this year.

But Ng says the tariffs are not justified at any level and will cause undue hardship for both Canada’s forestry industry and consumers in the US.

She says Ottawa will challenge the latest finding under the US-Mexico-Canada Agreement dispute resolution system.

Still, Ng is leaving the door open for a resolution to the years-long dispute, which some US lawmakers and observers have been calling for to help ease record levels of inflation south of the border.

“Canada has always been willing to work with the United States to explore ideas that could enable a return to predictable cross-border trade in softwood lumber,” Ng said in a statement.

“We remain confident that a negotiated solution to this longstanding trade problem is in the best interest of our countries, and we welcome an open dialogue with the United States to this end.”

US Trade Representative Katherine Tai also said the US is willing to talk, on one condition.

Tai wants Canada to address the provincial stumpage fee regime that American growers have long complained about and that gives growers north of the border an unfair advantage, the core of a dispute that has raged for decades.

Ottawa to challenge lower but ‘unfounded’ US tariffs on softwood lumber, says @mary_ng. #CDNPoli #US #SoftwoodLumber

Federal officials in Ottawa say Canada would never agree to such a fundamental change in the way a key Crown resource is managed before the two sides have sat down.

“These duties have caused unwarranted harm to Canadian industry and its workers,” Ng said.

“They also amount to a tax on US consumers, exacerbating housing unaffordability at a time of heightened supply challenges and inflationary pressures.”

Timber-producing provinces set so-called stumpage rights for timber harvested on Crown land, a system that American growers, forced to pay market rates, say amounts to an unfair subsidy.

Democratic Sen. Bob Menendez of New Jersey and Republican Sen. John Thune of South Dakota are among those who have urged the Biden administration to provide more tariff relief on imports from Canada.

The BC government echoed Ng’s disappointment when he urged the US to seek a longer-term deal.

“As we strive to make a more robust and sustainable forest economy, what we need most are partners across the border who work with us, not against us,” said a joint statement from Forests Minister Katrine Conroy, the Employment Minister Ravi Kahlon and George Chow. , the Minister of State for Commerce of the province.

“We will continue to work with the Government of Canada to advocate for a fair market for BC wood products and vigorously defend against this unfair U.S. trade action on softwood lumber.”

This report from The Canadian Press was first published on August 4, 2022.

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