Toughen Timber Trade Deal

The Register Guard (Eugene, OR), August 9, 2016 | Go to article overview

Toughen Timber Trade Deal


Byline: The Register-Guard

Maybe Donald Trump ought to think about building his wall along the border between the United States and Canada - better yet, make it a wooden fence. Since a softwood trade agreement between the two countries expired last year, Canada's lumber exports to the United States have increased 43 percent, and prices have been driven down by 25 percent. Canada is able to flood the market with low-cost lumber because its wood products industry is subsidized - a practice trade agreements are supposed to prevent.

U.S. Sen. Ron Wyden, D-Ore., was in Douglas County last week to meet with representatives of the state's wood products industry and to call for a renewal of the expired trade deal. Without it, some Oregon wood products manufacturers are likely to be unable to compete with Canadian lumber in their own country's market. Wyden called for a "fair system" of trade - and real fairness would require replacing the expired agreement with one that places U.S. and Canadian producers on an equal footing.

The agreement that expired last year took effect in 2006 and was the latest of nearly half a dozen attempts since the 1980s to ensure fair bilateral trade in lumber. Fairness has been difficult to achieve, because when it comes to forests the United States and Canada have fundamentally different economic systems. Timber in the United States comes from privately owned forests, or from public timber sold at auction in a competitive bidding process. Most Canadian timber is owned by the provinces, and is sold at prices set through an administrative process designed to ensure stable employment in the wood products industry.

Canada has always denied that its system results in subsidies, even though its timber prices are invariably low. Cheap raw material allowed Canada to post a $21.7 billion trade surplus in wood products last year, with more than two-thirds of the exports going to the United States and the remainder making it harder for U. …

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