Forests Minister Doug Donaldson and Premier John Horgan speak after their first cabinet meeting in Victoria July 19. Donaldson is in Asia all next week to sell the benefits of B.C. lumber. (Tom Fletcher/Black Press)

BC to fight softwood duties, Donaldson in Asia selling BC lumber

About half of Canada’s softwood lumber exports to the U.S. originate from B.C.

Premier John Horgan said last week in a press conference that he will take on American “lumber barons” in the softwood lumber dispute.

The United States Department of Commerce has announced its final determination of duties of 20.83 per cent to be applied to the majority of Canadian softwood lumber shipments entering the U.S.

The final countervailing duty rate is 14.25 per cent (a decrease from the preliminary rate 19.88 per cent) and the final anti-dumping duty rate is 6.58 per cent (a decrease from the preliminary rate 6.87 per cent).

West Fraser, which owns Pacific Inland Resources (PIR) in Smithers, is charged more than other companies. Total duties for PIR are 23.76 per cent with a countervailing duty of 18.19 per cent and anti-dumping rate of 5.57 per cent. That is down from the preliminary duty threat from the U.S. of 30.88 per cent.

About half of Canada’s softwood lumber exports to the United States originate from British Columbia, and the United States is British Columbia’s largest market for softwood lumber products. Over the past year, high lumber prices have helped to mitigate the impact of the softwood lumber duties on B.C. companies.

“We will continue to fight for the 60,000 British Columbians who depend on forestry,” said Premier Horgan. “The forest sector is an integral part of B.C.’s sustainable economy, and we will make sure workers, families and communities have the support they need to mitigate the impact of these duties. The reduction in rates by the U.S. Department of Commerce further indicates the strength of our appeal case and strengthens our resolve to fight for B.C.”

Stikine MLA and Forests, Lands, Natural Resource Operations and Rural Development Minister Doug Donaldson headed to Asia for a week-long trade trip with over 35 senior forestry executives to lobby in China and Japan.

He said on Nov. 3 that he has not had a chance to speak with smaller producers like Kyahwood Forest Products in Moricetown. Donaldson said he planned to talk with smaller producers about cash flow issues from the retroactive demand from the U.S. that deposits be made in April effective back to January.

“With the high price of dimensional lumber that might have been alleviated a little bit by now. Certainly some of the bigger companies like West Fraser, like PIR, we haven’t gotten any indications of lay-offs because prices are at an all-time high,” said Donaldson.

“This trade action is being driven by the protectionist United States lumber lobby, whose sole purpose is to constrain imports of high-quality Canadian lumber and to drive up lumber prices for their own benefit,” said Susan Yurkovich, president of the BC Lumber Trade Council. “This trade action ultimately punishes American consumers who are now paying higher prices for Canadian lumber when they buy, build or renovate their homes.”

He added that a few things have happened that affects Moricetown’s mill.

“The federal government has come through with an $867-million softwood lumber action plan, that was [June 1],” explained Donaldson.

Diversification funds are also available, he added. Another $6.8 million is available for skill and training upgrades for workers affected by the softwood dispute. How that money is rolling out has yet to be determined, according to Donaldson.

“My focus is not simply on trying to assist people who are going to be laid off but try to make sure people don’t get laid off,” he said.

That is why the focus of Donaldson’s Asia trip will be to sell higher quality, value added lumber products like cross laminate interior beams. He said while this would immediately help Interior plants, there was an opportunity for the North as well.

“Energy pellet, wood pellets that are being used to create electricity in these countries,” listed Donaldson.

“I was just at Prince George a couple weeks ago at an announcement where a Japanese company has invested tens of millions of dollars to take a 47 per cent share of Pacific Bio Energy. And they’re interested in investing more [to reduce greenhouse emissions].”

He believes expansion in the Northwest is possible with more demand from Asia for wood pellets like those now being produced at Newpro in Smithers.

British Columbia will be supporting the federal government in appealing the U.S. Department of Commerce’s findings. The appeals cannot be filed until after the U.S. International Trade Commission issues its determination in December.

In 2016, the B.C. forest sector supported 60,000 direct jobs and one in four manufacturing jobs, according to the B.C. government.

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B.C. Premier John Horgan speaks at the B.C. Legislature about duties on B.C.’s softwood Lumber. (Arnold Lim photo)

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