September 29, 2009

U.S. Lumber Benefits From Trade Ruling

International trade panel denies Canada's remedy for Softwood Lumber Agreement Violation

Washington, DC - Idaho's Congressional Delegation welcomed a ruling by an international arbiter in an ongoing dispute over Canadian softwood exports. The tribunal sided with the U.S. this week over an appeal related to Canada's proposed remedy for a Softwood Lumber Agreement (SLA) violation. As a result of the ruling a 10 percent duty on Canadian softwood imports may remain in effect.

"Our trade agreements and rules must be upheld to better ensure Idaho and American softwood lumber companies and workers can compete in a just market," said Idaho Senators Mike Crapo and Jim Risch and Idaho Congressmen Mike Simpson and Walt Minnick. "This ruling is an important step in correcting unfair trade practices impacting the U.S. lumber industry already hard hit by the decrease in homebuilding in the current economic climate, and the Administration's efforts on this case are commendable. Work must continue to ensure the SLA is properly upheld, but this ruling is an important action in this effort."

The Softwood Lumber Agreement between the U.S. and Canada was the basis for arbitration initiated by the U.S. two years ago over volume caps and related taxes. In this case, a tribunal previously determined that Canada violated the SLA and directed Canada to cure its breach. When Canada did not execute measures to compensate for the breach, the United States imposed 10 percent customs duties on imports of softwood lumber from Ontario, Quebec, Manitoba and Saskatchewan. Canada sought a determination of whether Canada's offer to provide a $36,660,000 payment to the U.S. government cured the breach, which was the subject of the ruling.