The 2006 softwood lumber agreement

The 2006 softwood lumber agreement

Burns Lake mill CEO: “Everyone is apprehensive”

Countervailing duty rates are expected to be announced at the end of April

Almost 600 industry and government leaders gathered in B.C. for the Council of Forest Industries (COFI) annual convention last week.

Steve Zika, Chief Executive Officer of Hampton Affiliates – company that owns Babine Forest Products and Decker Lake Forest Products, attended the convention, which was held in Vancouver for the first time.

“Overall, there is a positive mood that prevails but everyone is apprehensive about the two main threats we are all facing in British Columbia,” he said, referring to the impending reduction in annual allowable cut and the ongoing softwood lumber trade dispute with the U.S.

Earlier this year, the U.S. International Trade Commission upheld the U.S. industry’s claim of “injury” due to alleged unfair trade practices by Canadian producers. The complaint accuses B.C. and other provinces of “dumping” lumber below market value. The finding means the U.S. could impose countervailing duties on B.C. lumber exports, which make up half of Canada’s sales to the U.S.

“Initial countervailing duty rates are expected to be announced the last week of April and no one has any idea what the duty rate will be or whether the duties will be retroactive,” said Zika. “The antidumping duties will follow later.”

Therefore it still remains unclear how Burns Lake area mills will be affected.

“I believe the provincial and federal government have done the best they can to try and resolve this matter but they have no control over the U.S. government,” he added. “Most observers expect it could take six months or maybe years to resolve the trade battle or negotiate a new agreement.”

However, Zika said that, from a market standpoint, the forest industry has many reasons to be optimistic.

“There is increasing demand from all our major markets including the U.S., Canada, China and Japan,” he said. “Lumber prices are on the rise and Michael Green, the Vancouver architect, inspired us with the vision of using more wood in urban areas and tall wood buildings.”

“This growing trend can be led by British Columbia which will result in more business and improvements in our environment,” he continued. “Overall, COFI has put together a great convention with a lot of interesting interaction.”

Highlights of the conference included an update on B.C.’s forest industry by COFI president Susan Yurkovich, remarks by Steve Thomson, Minister of Forests, Lands and Natural Resource Operations, and a keynote address by premier Christy Clark.

– With files from Tom Fletcher