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SOFTWOOD LUMBER: Dispute Results in Job Losses


February 6, 2002
By Pulp & Paper Canada

MONTREAL, QC and VANCOUVER, BC — The continuing softwood lumber dispute between Canada and the United States is te…

MONTREAL, QC and VANCOUVER, BC — The continuing softwood lumber dispute between Canada and the United States is testing the resolve of Canadian producers, particularly after the US Department of Commerce announced on October 31 that it would be levying additional penalties — averaging 12.58% — on Canadian softwood lumber entering the US. This is on top of the 19.3% countervailing duty levied on exported lumber since last August.

For example, Tembec Inc., hit with a 10.76% dumping penalty, has temporarily closed its sawmill in Kirkland Lake, ON, throwing 88 people out of work. Abitibi-Consolidated Inc., hit with a 13.64% penalty, calculated its after-tax effect at $32 million a year. “We’re confident that lower rates, if any, will prevail in the final determination,” said John Weaver, president and chief executive officer.

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Others are more in a hurry to see this dispute end, with good reason. Slocan Forest Products Ltd. in Vancouver has been hit with a 19.2% dumping tariff. Adding the 19.3% countervailing duty, the company faces total duties of 38.5% — the highest of any Canadian company. “The absurdity of the situation underlines that fact that this duty is politically motivated and bogus beyond belief,” said Jim Shepherd, Slocan president and chief executive officer. “It makes a mockery of commercial reality.” The company, rated as the world’s best-performing forestry company in 1999 and 2000, achieved profitability while keeping it lumber prices low, Shepherd said. “We did it by being lean and efficient, not by dumping.”


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