U.S., Canada vow to fix long-standing softwood lumber dispute

By David Ljunggren
WASHINGTON, March 10 (Reuters) - The United States and
Canada on Thursday vowed to settle a long-standing dispute over
Canadian exports of softwood lumber which could erupt again this
October when an earlier agreement on the problem expires.
U.S. producers complain that Canadian softwood lumber, which
tends to come from government-owned land, is subsidized. A 2006
deal that ended the last dispute expired in October 2015 but
both sides agreed to take no action for a year after that.
Faced with the prospect of the U.S. timber lobby pressing
for penalties when the grace period runs out this October,
President Barack Obama and recently elected Canadian Prime
Minister Justin Trudeau asked officials to work out possible
solutions and report back within 100 days.
"This issue of softwood lumber will get resolved in some
fashion ... undoubtedly to the dissatisfaction of all parties
concerned," Obama told a news conference after holding Oval
Office talks with Trudeau.
"Each side will want 100 percent, and we'll find a way for
each side to get 60 percent or so of what they need, and people
will complain and grumble, but it will be fine," he said.
Trudeau said he was confident both sides were "on the right
track towards a solution in the next weeks and months to come".
Major companies operating in Canada which could be affected
if the U.S. lobby pushed for higher duties on lumber include
Canfor Corp CFP.TO , Tembec Inc TMB.TO , Resolute Forest
Products Inc RFP.N and West Fraser Timber Co Ltd WFT.TO .
"We're pleased we're getting this high level of attention,"
said Susan Murray, spokeswoman for Forest Products Association
of Canada.
The Coast Forest Products Association, which represents
forestry firms operating along the coast of British Columbia,
said the announcement was good news.
The lumber dispute is an irritant in a relationship worth
some $2 billion a day in two-way trade and investment.
Obama said he and Trudeau had also told officials to work
out ways to make it easier for goods and people to move back and
forth across the borders, including reducing bottlenecks and
streamlining regulations.
"When so many of our products, like autos, are built on both
sides of the border in an integrated supply chain, this
co-production makes us more competitive in the global economy as
a whole. And we want to keep it that way," he said.