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Press Release: CPA Supports US Duties to Counter Canadian Government Lumber Subsidies

April 25, 2017

Washington~ The Trump administration announced Monday evening that it will impose countervailing duties up to 24% on imported lumber subsidized by the Canadian government.   The Commerce Department announced its Preliminary Determination of Countervailable Subsidies on April 24, 2017 after a long running investigation. CPA strongly supports the Trump Administration’s move to eliminate the unearned advantage given to Canadian companies in the softwood lumber market and to help U.S. producers.

"US economic harm from NAFTA comes not just from Mexico, but Canada as well. Canada has long used a complex network of subsidies to artificially bolster its lumber products in the US and international markets,” said Michael Stumo, CEO of CPA. “The subsidies include selling timber from government-owned timber stands, in the form of stumpage fees, at below cost to domestic lumber companies. The practice is very effective because most harvestable timber stands in Canada are government owned, while US timber stands are privately owned and tend to sell timber harvesting rights at fair market prices.”

The action came days after President Trump called out Canada’s unfair dairy trade practices in which a government program prefers Canadian producers and has thus effectively prohibited US milk protein concentrate from being sold there.

The lumber industry dispute has continued for decades as Canada continued subsidizing its lumber industry to enable their products to be sold at below-market prices in the US.  “This is not our idea of a properly functioning free trade agreement,” said Commerce Secretary, Wilbur Ross, referring to the North American Free Trade Agreement."

“China’s state capitalism model uses government owned resources to provide its companies with free or low cost funding, property and energy,” continued Stumo. “Canada uses similar practices to give its lumber industry an unearned advantage so they can expand market share and profits at the expense of efficiently run, private competitors in the US.” 

Democratic Senator and ranking member of the Senate Finance Committee, Sen. Ron Wyden (D-OR) applauded the Commerce Department’s decision.

“Unfairly traded softwood lumber from Canada has for decades hurt mill towns and American millworkers in Oregon and across the country. Today’s announcement sends the message that help is on the way,” Wyden said. 

The Coalition for a Prosperous America is a nonprofit organization representing the interests of 2.7 million households through our agricultural, manufacturing and labor members.

Contact: Paola Masman, Media Director 
202-688-5145 ext 2, paola@prosperousamerica.org


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