Well, it’s been a long 13 months since Stephen Harper delivered the goods (otherwise known as the self-screwing) on the softwood lumber dispute with the US. Longtime Conservative David Emerson brokered the agreement to much fanfare and hoopla, as evidenced in this CBC article. As explained in the article, the illegally-imposed American tariffs (according to the WTA and NAFTA tribunals) were removed and in their place producers had to pay an export tax of between 5-15%. All because we Canadians are more efficient at raping the environment than our American cousins. Anyway, the point is that Harper delivered where Martin/Chretien failed, and finally ended the softwood war forever.
The United States made good yesterday on its threat to force Ottawa and the timber-producing provinces to comply with the 10-month-old softwood lumber agreement (SLA), saying it will seek binding arbitration against Canada in a move that could cost the domestic industry hundreds of millions of dollars in extra costs.
Susan Schwab, the U.S. Trade Representative, said she is filing a formal complaint through the London Court of International Arbitration because of what she said was Ottawa’s refusal to live up to the agreement.
“It is truly regrettable that, just 10 months after the agreement entered into force, the United States has no choice but to initiate arbitration proceedings to compel Canada to live up to its SLA obligations,” she said.
It seems that the USA want to dishonour this agreement, or that Canada is not living up to the deal, depending on who’s speaking. In reality, the housing bubble in the US burst a few months ago, and lumber prices have dropped by about 20% since that bubble burst. The US lumber industry, instead of taking it’s lumps and accepting that commodity markets experience lows from time to time, is going after it’s favourite whipping boy, the Canadian lumber industry.
The bad deal that Emerson/Harper bent over for was good enough when lumber prices were US$355 per thousand board, but the penetration was insufficient for US$305 per thousand board. The seven year deal is not dead yet, but it’s certainly taking a beating.
Good jobs all around.