WASHINGTON, D.C.-- Senator Susan Collins today released this statement following the announcement that U.S. Trade Representative Rob Portman and Canadian Prime Minister Stephen Harper have reached a seven-year deal to settle a long-standing trade dispute over softwood lumber. In order for this agreement to take effect, a full legal text must be drafted and agreed upon, the lumber companies in both countries must agree to drop any legal complaints, and Canadian lawmakers must pass new export tax measures. This process could take several months to complete.
"I am hopeful that this negotiated settlement between U.S. and Canadian officials will finally provide a resolution to this ongoing dispute which is in the best interest of both countries," said Senator Collins. "Canada has always been and remains a valuable trade partner with the U.S. and I applaud the effort that made this deal possible. The forest products industry is a critical part of Maine’s economy, and it is good news that this agreement would provide a level playing field between Canadian and U.S. producers.”
Canada subsidizes its lumber industry which threatens the U.S. lumber industry by keeping Canadian lumber at artificially low prices. Under the terms of the tentative deal between the U.S. and Canada, the U.S. government would revoke the antidumping and countervailing duty orders on Canada as long as prices do not exceed certain levels at specific volumes. Canadian provinces would face a choice between capping their total exports to the U.S. and accepting lower duties or collecting taxes of as much as 15 percent and not facing any cap on their trade. The size of the tax and the cap would depend on lumber prices. At current prices, Canadian producers would face no cap or tax. In addition, the U.S. government would return to Canadian companies about $3.6 billion of the more than $5 billion in duties collected over the past four years. Much of the remainder of these duties would be distributed to U.S. producers hurt by unfair imports.