Trump is right about Cana­dian soft­wood: Jimmy Carter

Canada must still play by the rules: for­mer pres­i­dent

The Hamilton Spectator - - COMMENT - JIMMY CARTER

I agree with the re­cent de­ci­sion of the White House and the Com­merce De­part­ment to im­pose an­ti­sub­sidy du­ties against Canada’s un­fairly traded soft­wood lum­ber im­ports. This be­lated en­force­ment of U.S. trade laws will help mil­lions of pri­vate tim­ber­land own­ers, Amer­i­can forestry work­ers and mem­bers of their lo­cal com­mu­ni­ties by lev­el­ling the play­ing field in the tim­ber in­dus­try.

Tim­ber sales are a ma­jor source of in­come for my own fam­ily, and we have suf­fered fi­nan­cially for many years from an un­fair ad­van­tage en­joyed by our ma­jor com­peti­tor in this vi­tal mar­ket.

With mod­er­ate ad­just­ments in man­age­ment, there is enough tim­ber­land in the United States to sup­ply the to­tal Amer­i­can mar­ket with lum­ber. With­out ad­just­ing any U.S. tim­ber poli­cies, and if we are able to com­pete on a level play­ing field against Canada, our pro­duc­tion of lum­ber could sat­isfy more than 84 per cent of to­tal U.S. de­mand, ac­cord­ing to West­ern Woods Prod­ucts As­so­ci­a­tion data. This would leave the re­main­ing 16 per cent to be sup­plied by im­ports, but now about 32 per cent of our lum­ber is be­ing im­ported from Canada.

Canada en­joys an in­her­ent ad­van­tage in that the vast ma­jor­ity of its stand­ing tim­ber is owned by pro­vin­cial gov­ern­ments, which are free to dump their tim­ber at prac­ti­cally no cost in or­der to stim­u­late their for­est in­dus­try. At the same time, most of Amer­ica’s tim­ber is pri­vately owned, and mar­ket forces im­pose a min­i­mum price at which farm own­ers can con­tinue in busi­ness.

There has been a long-last­ing dis­pute about im­port­ing Cana­dian soft­wood, which has gone through an in­creas­ingly cru­cial phase dur­ing the past 35 years. About 70 per cent of Canada’s soft­wood lum­ber ex­ports came to the United States in 2015. One in­di­ca­tion of the re­cent changes in mar­ket forces is that the num­ber of Cana­dian-owned sawmills in our coun­try has ex­ploded to more than 40 in the past decade — par­tially be­cause of lower labour costs in the United States.

The lat­est Soft­wood Lum­ber Agree­ment ex­pired on Oct. 12, 2015, and Cana­dian pro­duc­ers now have al­most un­re­stricted ac­cess to the U.S. soft­wood lum­ber mar­ket. Last month, the Trump ad­min­is­tra­tion an­nounced plans to im­pose av­er­age du­ties of 20 per cent on most Cana­dian lum­ber, charg­ing that these lum­ber com­pa­nies are sub­si­dized by the gov­ern­ment. To re­main in ef­fect, how­ever, the du­ties need to be fi­nal­ized by our Com­merce De­part­ment and then con­firmed by the U.S. In­ter­na­tional Trade Com­mis­sion af­ter an in­ves­ti­ga­tion that in­cludes tes­ti­mony from both sides. This en­force­ment of U.S. trade laws is con­sis­tent with our in­ter­na­tional com­mit­ments.

The mem­bers of my fam­ily own about 1,800 acres of tim­ber­land, and the soft­wood (pine) tracts are mostly planted as seedlings (from 550 to 900 per acre) that even in our warm cli­mate need to grow for at least 25 years be­fore be­com­ing large enough to sell for lum­ber. Un­less in ur­gent need of cash in­come, we usu­ally wait at least 10 ad­di­tional years be­fore har­vest­ing and re­plant­ing. Af­ter this 35-year pe­riod, we sell our soft­wood tim­ber — usu­ally less than 100 acres a year — in a com­pet­i­tive and open process to Cana­dian sawmills to make lum­ber.

With logs sell­ing at the present price of $25 per ton, we can ex­pect to re­al­ize a net in­come of about $875 per acre, or just $25 a year over 35 years, plus some se­condary in­come for pulp wood and other prod­ucts. Largely be­cause of Canada’s un­fair trade, the prices we re­ceive to­day are the same as when I was in of­fice over 35 years ago, al­though ex­penses from plant­ing seedlings, thin­ning, re­mov­ing un­mar­ketable trees, pe­ri­odic con­trolled burn­ing and tim­ber sev­er­ance taxes are much greater.

While there are many ben­e­fits to har­mo­nious bi­lat­eral re­la­tion­ship be­tween the United States and Canada, our neigh­bour to the north must still play by the rules and stop en­gag­ing in its un­fair trade prac­tices. We must ei­ther en­force U.S. trade laws with tariffs or in­sist on an ef­fec­tive and last­ing bi­lat­eral soft­wood trade agree­ment that al­lows our in­dus­try to sur­vive, pro­vide jobs for work­ers and sus­tain vi­brant forestry com­mu­ni­ties across our coun­try.

Jimmy Carter was the 39th pres­i­dent of the United States.


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