Softwood exports to U.S. down, prices up

OTTAWA — Canada’s softwood lumber exports to the U.S. have fallen since the Americans imposed new duties this year, but thanks to near-record wood prices, the industry isn’t suffering much from the trade fight.

As the end of 2017 approaches, it seems unlikely a new softwood agreement will be inked between Canada and the U.S. this year. But the industry association representing most softwood producers in Canada isn’t that concerned about it.

Joel Neuheimer, vice-president of international trade and transportation for the Forest Products Association of Canada, said the higher price of wood, coupled with an insatiable demand from U.S. builders, are helping to keep the duties from pushing companies to close, lay off staff or cut production.

“If we were not seeing the same kind of demand and the same kind of high prices we’re seeing, then we might be in an entirely different type of situation,” Neuheimer said.

Trade data from the United States Department of Agriculture show the amount of Canadian softwood imported was down eight per cent for first nine months of 2017, compared with the same period in 2016.

The value of those imports went up very slightly — 0.15 per cent — because even though less wood was shipped, each piece of lumber was worth more.

Statistics Canada data show that British Columbia producers are bearing the brunt of the drop, with softwood exports to the U.S. down about 33 per cent. The value of those exports was down 28 per cent.

British Columbia’s wild fires last summer had a big impact on the province’s forestry industry, with softwood exports in July and August only about half what they had been a year earlier.

Canada and the U.S. continue to negotiate a new softwood trade agreement. The U.S. Lumber Coalition has complained that Canada unfairly subsidizes its producers with low stumpage fees for harvesting trees and that Canadian producers are selling wood into the U.S. at lower prices than they sell it at home.