West Hill Collegiate Institute - International Business

Established in 2012, by Daniel Shafransky and Raymond Ahmad

Agreement Expires: 2016

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  • Isabella Castro Rojas
  • Destinique McLean
  • Minesh Mistry
  • Shahzad Dinani

12 Comments

  1. PART 1
    Canada and the U.S. Softwood Lumber Dispute is known to be one of the longest and most compelling disputes between two countries in modern history. Canada is recognized for being one of the largest softwood lumber producers and exporters in the world. Softwood lumber is used in various ways such as moulding, papers, doors, windows etc.. On October 2015, the SLA 2006 expired. As being part of the original 2006 agreement, the members of the US Lumber Coalition, and the government came to an agreement to not file petitions under the U.S trade laws for one year after the expiration. On June 2016, The United States president Obama, and the prime minister of Canada, Justin Trudeau, made public a new joint statement that two nations are to negotiate a new agreement. The new agreement is said to be designed “to maintain canadian exports at or below an agreed US market share to be negotiated.” The coalition strongly supported this idea identified in the Joint Statement. On November 2016, the lumber industry filed an “antidumping and countervailing” duty case under the U.S. trade laws due to the fact that they did not attain a new trade agreement. On November 25th the Coalition petitioned to restore fair trade in Softwood Lumber between The U.S and Canada.

    http://www.cbc.ca/news/business/softwood-lumber-trade-1.3270006
    http://www.mapleleafweb.com/features/canada-us-softwood-lumber-dispute.html
    https://beta.theglobeandmail.com/news/politics/canada-us-may-not-meet-deadline-for-softwood-lumber-deal-freeland/article31892249/?ref=http://www.theglobeandmail.com&

    • I agree with the events that occurred in 2016 when the agreement expired because both side were trying to come to a new deal that supported and benefited both the US and Canada. Both sides are voicing their concerns and making sure a deal is not made until both are happy. While at the same time still came to an agreement to not file petitions under US trade law. This is similar to my topic because they are both about when the lumber agreement expires and the effect it has and the dispute that is brought along with it. But different due to the fact of they seem more civil this time around rather then back in 2005 when it was a fight between the two countries which to this day is still a dispute just less hostile. This dispute will continue to be a dispute until both sides are completely happy which is very rare to happen, so it will probably be disputed for many years to come.

  2. PART 2: 5 Years of Peace

    Canada and the United States made an agreement on Softwood Lumber exports. Canada agreed to impose tax on exports destined to the United States, they were given unrestricted access to the American markets for the next five years, and the United States agreed not to impose its own duties on softwood. Canada’s motive for this deal was so that they can have five years of peace where the Americans won’t petition a trade file against their Softwood Lumber. As a favour in return if Canada’s exports of softwood lumber go above a certain preset, they will charge an export fee to the industry. Canada said this to be the best deal in a bad situation because they felt that if they did not make a deal, the U.S. would take action and put tariff on the Canadian Lumber which would be really damaging to their industry. Canada wishes this agreement has an affect so they can remain competitive in the North American Softwood Lumber market.

    http://www.cbc.ca/archives/entry/softwood-dispute-five-years-of-peace

  3. Part 1:
    The Softwood Lumber Agreement expired on October 12, 2015. Going into 2016, the United States government and industry agreed to not undertake new countervailing or antidumping duty investigations against Canadian softwood lumber products, for one year period, following the expiry of the SLA. This one year period expired on October 12, 2016. during this tariff-free stretch of time, Canadian Lumber U.S. market share rose to 32 per cent.
    Negotiators from the U.S. and Canada met in Ottawa May 26, 2016 and it appears that talks toward reaching a new accord between the countries are still in the preliminary stages. They met in Ottawa June 29 for the so-called Three Amigos Summit that includes Mexico’s president. Spokespersons from each country issued statements that made it clear that progress has been difficult to this point.
    In July, a joint statement issued by President Obama and Prime Minister Trudeau following a meeting in Ottawa in late June, softwood lumber talks between the countries are termed “challenging but productive.” In August, with two months to go before the one-year standstill period expires in October, most lumber traders in the U.S. and Canada are bracing for the two countries to head back to court in the long standing dispute. Canada’s chief negotiator acknowledged that discussions had been constructive, but that reaching a deal by mid-October would be a challenge, and they do remain far apart on several key issues. October comes, the one-year standstill period ends without an immediate filing of countervailing and/or anti-dumping duty petitions from the U.S. Lumber. November 2016, the move traders had been anticipating for weeks happens after thanksgivings, when the U.S. Lumber Coalition files countervailing and anti-dumping duty petitions against Canadian lumber imports. The opposition says Liberals dropped the ball by not getting a long-term agreement done before the standstill deal expired.

    Sources:
    -Government of Canada, Global Affairs Canada, Deputy Minister of International Trade, Communications Bureau (International Trade), Outreach and E-Communications Division. (2017, July 25). Background – Canada-United States Softwood Lumber Trade. Retrieved November 01, 2017, from http://www.international.gc.ca/controls-controles/softwood-bois_oeuvre/background-generalites.aspx?lang=eng
    -McGregor, J. (2017, June 22). More duties coming, as softwood lumber has potential to ‘throw NAFTA off the rails’. Retrieved November 01, 2017, from http://www.cbc.ca/news/politics/softwood-lumber-anti-dumping-advancer-1.4171528
    -(n.d.). Retrieved November 01, 2017, from http://www.mapleleafweb.com/features/canada-us-softwood-lumber-dispute#issue
    -McGregor, J. (2016, June 30). ‘Significant differences remain’ in struggle for softwood lumber deal. Retrieved November 01, 2017, from http://www.cbc.ca/news/politics/softwood-lumber-trade-obama-amigos-1.3659499
    -U.S.-Canada Lumber Trade Dispute. (2017, November 02). Retrieved November 01, 2017, from http://www.randomlengths.com/In-Depth/US-Canada-Lumber-Trade-Dispute

    • Part 3

      I agree with the events that had occured because they were having many discussions about renewing the deal and/or beginning a new one. They took their time in determining the new deal making sure both sides were happy and secure with the decison that would take place. Both sides were not happy with the deal that was brought to the table there for they didn’t agree on it which shows that theyre standing there point. After all these years they spent fighting over the imports and exports of lumber, they need a satisfactory conclusion.

    • In my opinion, I believe that the Canadian government should’ve been more effective and taken advantage of this stand still period. They could’ve negotiated a new agreement without any outside tension form duties being imposed as they cannot attack each other throughout this period. By the end of 2016, the U.S. filed those duties once again, as expected, therefore it is as if we lost our best chance to negotiate a fair and good deal. Without being effective and productive within the year break, Canada weaken the bond between the United States which will affect them in the long run as the United States is Canada’s number one trading partner. Overall, the year break has been put to waste and next time Canada should think ahead of time and for the future.

  4. Part 2:
    (2016, December 22). Retrieved November 02, 2017, from http://www.cbc.ca/player/play/930151491594

    The radio transmission chosen was broadcasted on December 22, 2016, titled Deborah Yedlin on software lumber dispute. This clip explore the question: Is Canada in a trade war with the United States? The Canadian government just fired back after the U.S. Commerce Department offered lumber imports with duties ranging from 3% to up to 24%. Prime minister Trudeau vowed that he will stand for Canadian interest for whether it’s softwood or software. It feels like Canada is once again in a trade war with our American Neighbors. Right now there are avenues to appeal this positioning , first through the WTO , the other one is through the chapter 19 of NAFTA, which is a dispute resolution mechanism. This is the fifth time Canada is going to be doing this, and every time, Canada comes out on the good side of the decision. Canadians are thinking all this is going to be another process, and arguments will most likely be in favor of Canada against the U.S. However, given that the iterations of the dispute have gone through international tribunals again and again, and every single aspect of the U.S. argument has been thrown out and found to be baseless, has Canadians quite frustrated.

    Also, there is the big concern that if this is a trade war ,then you get all these scrimmages on different fronts, and it might spread onto different industries.

    On the softwood issue, the management and pricing of lumber from crown forest is largely a provincial responsibility. The provinces are thinking about protecting their own lumber industry. They require the companies to plant trees, also there are environmental standards that go with the forestry industry. Meanwhile, the lands in the U.S. are privately owned, so that is a different story.

    This whole situation puts us in a position where Canada has to diversify their market, that what we sell is going in markets other than the US so that we don’t lose that revenue. There’s a lot of markets that Canada has to explore, and really think about deliberately targeting them, so to not be so reliant on the United States. This is just one more message about how we have to look more outward as a country.

  5. Part 3:
    The softwood lumber industry is an important sector in the Canadian economy, it provides a great deal of jobs while bringing a significant revenue. Despite the U.S. market’s dependence on imported lumber, the U.S. lumber industry has frequently sought U.S. government restrictions on Canadian softwood lumber imports through the application of U.S. countervailing and antidumping duty laws. This gave rise to the Canada-U.S. Lumber Dispute. This dispute has been ongoing, dragging along from all the way back in 1982, and along with this constant fight for lumber tariffs, come devastating effects on both the economy and the public relationship of these two major trading partners.
    This conflict that arose long time ago has impacted, negatively, the lumber industry for both Canada and America. The instability created by such has lead to complication between trading of these two. As a result, there has been tensions created between both neighbouring countries, between the countervailing and dumping duties posed from the U.S., it has even caused the layoff of many workers in the lumber industry in Canada, and increase in prices for certain things in America. Canada has come up on top of the judgment every single year, the thing is, so much of this doesn’t make sense. The U.S. can’t supply its own lumber needs, so it relies on Canada supplying around 30% of their lumber. If the U.S. continues to do this, they’re going to see increase in the prices of homes and furniture renovations. People really don’t want to see their cost increase, so from an economic standpoint this doesn’t make much sense.
    Since lumber trade with the U.S. presents so many obstacles and complications, this should bring attention to the fact that Canada needs to start looking at ways to access other markets, and not only place its focus on the U.S. regarding lumber trade. We should be looking at the Pacific lines, and South American countries, this trading block is very valuable. In conclusion, the softwood lumber dispute has had a detrimental effect on the lumber industry for both countries. The reasons as to why the U.S impose the dump and countervailing duties on Canadian exports of lumber are most of the time arguable, and not valid enough to hold up to the claim. As a result, the negative impact of this dispute has been great, and should be considered if it is even worth.

  6. Part 1

    The Softwood Lumber (SLA) dispute between Canada and USA is one of the longest and mesmerizing disputes in history. Canada is also recognized as one of the largest Softwood Lumber producers and exporters in a way. There are a various amount of ways that are beneficial such as windows, doors, papers, etc and some different types are Fir, Cedar, Pine, etc that all contribute in a different form and is extremely effective in different areas / categories. The SLA agreement had expired on March 31, 2001 and two days later, the U.S. Department of Commerce (hereafter referred to as Commerce) received a petition from the Coalition for Fair Lumber Imports, alleging that Canadian producers of softwood lumber products were receiving subsidies and were selling their products in the United States at less than fair value, and that such imports were materially injuring the U.S. industry. It seemed as if they came to another agreement in 2006 which had expired in October 2015. After one year of the expiration, the US Lumber Coalition and the government came to an agreement to not file a petition under the U.S Trade Laws and as a follow up to that, President Obama and the Prime Minister of Canada, Justin Trudeau, allegedly made a new joint statement that two nations will be negotiating an agreement that will be beneficial to both sides. The new agreement was set to maintain all Canadian exports at or below an agreed US market share that is still yet to be discussed. The US coalition was extremely supportive of this joint statement. On November 2016, the lumber industry filed an “antidumping and countervailing” duty case under the U.S. trade laws due to the fact that they did not attain a new trade agreement. On November 25th the Coalition petitioned to restore fair trade in Softwood Lumber between The U.S and Canada. Due to all the chaos, it seems as if the coalition decided to attempt to retrieve the original agreement between both nations.

  7. Part 2: 5 Years in Peace

    Canada and the US had come to an agreement on Softwood Lumber exports. Canada had agreed to impose tax on exports that were destined to the United States. The Canadians were given unrestricted access to the American markets for the following five years and the US had agreed to not impose any sort of duties or tariffs on softwood lumber. Canada’s intentions for this deal was so that they could have five years in peace where the Americans wouldn’t create a petition against their trade file for Softwood Lumber. In return, Canada’s exports of softwood lumber go above a certain preset as they will charge an export fee to the industry. Canada believes this is the best deal and outcome in a bad situation because they felt that if they did not make a deal with the US, they would take action and put tariffs on Canadian Lumber which would injure their industry dramatically. Canada hopes this agreement has a positive affect so they can remain competitive in the North American Softwood Lumber Market.

    http://www.cbc.ca/archives/entry/softwood-dispute-five-years-of-peace

  8. Part 3

    In my opinion, I believe that the Softwood Lumber dispute has changed gradually over time but there is some relevant aspects and similarities that have been carried on and is an on going tradition till this day. Today, and in the past, there has been many jobs that were put on line and lacked employment and their stability overall which demanded Canada to pay a high amount of tariffs but what has changed over time is that the price of the tariffs has increased from the past which makes the dispute even worser in a way. I believe that this dispute has a lot of negative aspects that can be resolved if a agreement were to be made that would allow stability for all nations, groups, etc that are involved in the SLA but unfortunately that doesn’t seem to be the case as British Columbia being the largest producer of softwood lumber continues to raise their prices for it’s buyers. It hurts the economy because as prices go up, industries & companies are unable to afford the value being demanded, therefore it forces them to lay off workers and provides less jobs in the lumber industry which creates a crisis and people in demand for work. This affects Canada’s environment overall and I believe that there should be a fair agreement financially where everyone could be equal and prices are made at a fair rate to become affordable. If not, I believe it will continue to become worst which is bad for the lumber industry as a whole.

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