U.S., Canada extend lumber trade pact, but dispute continues

Published: Monday, January 23, 2012, 6:26 PM     Updated: Monday, January 23, 2012, 7:05 PM

By Richard Read, The Oregonian

 

View full sizeJAMIE FRANCIS/THE OREGONIAN

Logs head for the Warm Springs Forest Products mill in Central Oregon.

 

The United States and Canada have decided to extend a lumber trade agreement for two years, but a dispute continues over Canadian exports that U.S. mill managers consider unfair.

U.S. lumber industry leaders still contend that British Columbia misgrades and
underprices timber, enabling Canadian mills to undercut competitors in the
United States and abroad. That perception and other disputes over the years
explain the lukewarm reaction Monday from Oregon industry leader Steve Swanson,
chairman of the U.S. Lumber Coalition.

"We are supportive of the extension, but compliance with the existing Softwood
Lumber Agreement is imperative," Swanson said. "If Canada continues to violate
it, then we need to make sure that our government continues to pursue those
violations."

The 2006 agreement will remain in effect through Oct. 12, 2015, U.S. Trade
Representative Ron Kirk said Monday. Canadian news reports described the
extension, closely following President Barack Obama's rejection of the Keystone
XL pipeline from Alberta to the U.S. Gulf Coast, as an olive branch from the
United States.

Swanson, president of the Swanson Group based in Glendale, Ore., described the
agreement as a compromise that is "not ideal." He cited the current dispute,
which is undergoing arbitration expected to wind up later this year.

Canadian exports to the United States have fallen, along with the collapsed
housing sector, to account for about a quarter of the U.S. market, said John
Allan, president of the BC Lumber Trade Council in Vancouver, British Columbia.
Exports to China have boosted Canada's mills.

Sales to China helped prevent closure of Swanson's Glendale mill, which now runs
at three-quarters capacity serving the U.S. market. With two sawmills, two
plywood mills and an aviation division, Swanson Group has about 750 employees,
down from more than 1,200 at its peak in 2007.
-- Richard Read, twitter.com: ReadOregonian