As you are now aware, the moratorium of one (1) year agreed upon by both countries expired October 12, 2016 at 11:59 pm. The U.S. and Canadian negotiators are continuing to meet in Washington, D.C., with the goal of laying the framework for a new bilateral agreement. The objective for both sides is to avoid the litigation and monies spent in each of the previous trade disagreements on this commodity.
The Softwood Lumber Agreement (SLA-2006) contained a clause that barred both countries from seeking additional trade remedies for a one year period. This timeframe was inserted to allow each side time to craft a new arrangement.
The U.S. Lumber Coalition issued a press release, where the pertinent portion stated, “If we cannot have an agreement that works, then obviously we would have no choice but to initiate trade cases”. This was penned by the executive director of the U.S. Lumber Coalition who further stated, “From our perspective, it looks like we’ll have no choice but to file cases. In doing so, we’re simply doing what we have to do.”
In the past, the U.S. has introduced anti-dumping and countervailing duty investigations against Canadian softwood lumber, and Canada successfully defended against those actions. Expectations are that these actions may repeat themselves.
With the Canadian dollar being low, and the U.S. housing market picking up, the demand for Canadian lumber has grown. The United States has long argued lumber produced in Canada is subsidized by government, but Canadian industry experts argue it has more to do with American producers wanting a better share of the market.
We continue to hope that each side brings a position that is acceptable to both, and will bring you any updates that happen.