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Canada and US dispute timber dumping

The US government says it is launching investigations to determine whether softwood lumber imports from Canada were dumped into the country and harmed the American forestry sector. Source: CBC

The US Commerce Department says it will work with the US International Trade Commission to examine allegations that wood was dumped at less than its fair value and that Canadian forestry firms received unfair financial assistance from governments.

The decision to investigate is in response to petitions filed last month from the US Lumber Coalition and could result in the imposition of preliminary duties in the next few months.

The Commerce Department will determine whether dumping took place while the International Trade Commission will decide if the US industry was materially injured or threatened.

If the commission determines by 9 January that Canadian softwood harmed the US lumber sector, it will issue preliminary countervailing duties on 21 February and preliminary anti-dumping duties on 4 May, unless those deadlines are extended.

Canada exported about US$4.5 billion worth of lumber to the US last year, according to the Commerce Department.

The US Lumber Coalition alleges that provincial governments, which own most of Canada’s vast timberlands, provide trees to Canadian producers at rates far below market value, along with other subsidies.

As a result, the group says Canadian lumber is being sold for less than fair value in the US, hurting mills, workers and communities.

Softwood producers in Canada dispute the US Lumber Coalition’s allegations.

Montreal-based Resolute Forest Products said producers in Quebec and Ontario pay market prices and should have access to free trade with the US.

The BC Lumber Trade Council has said the claims levelled by the US lumber lobby are based on unsubstantiated arguments that were previously rejected by independent NAFTA panels.