Softwood Lumber Agreement: Finally some good news!
MONTREAL, Jan. 23, 2012 /CNW Telbec/ - The Ontario Forest Industries Association (OFIA) and the Council of the Quebec Forest Industry (QFIC) are satisfied with the two-year extension of the Canada-US softwood lumber Agreement (SLA), announced today by Federal Minister of Foreign Affairs and International Trade (DFAIT), the Honorable Ed Fast. Furthermore, we are pleased that issues raised by Central Canada's forest sector with DFAIT are reflected in the extension announced today
«This endorsement of the extension by the Central Canada Industries is based on current economic conditions which have, even without the competitive constraints of the SLA, shuttered much production and reduced substantially Central Canada's export capacity». said Mrs. Jamie Lim, President and CEO of the Ontario Forest Industries Association (OFIA).
This announcement removes an uncertainty that hung over the forest sector. "It does not solve the problems of market or economic conditions, but at least our companies exporting softwood lumber to the United States are now aware of the rules that will apply until October 2015." said M. André Tremblay, President and CEO of the Council of the Québec Forest Industry (QFIC).
It is worth noting that Canada's softwood lumber industry paid a very significant initiation fee of $1 billion for the SLA that was, according to the Congressional Research Service, split with half going to the U.S. lumber companies and the rest used for joint North American lumber initiatives. This initiation fee was paid despite a legal ruling that would have seen all duty deposits returned to Canada. Since 2007, under this agreement, Québec and Ontario companies have paid more the $190 million in border taxes on their exports of softwood lumber to the United States. Central Canada, in light of its prior payment and sacrifice, now looks to whatever continuing benefits may be derived from the SLA according to the already agreed terms.
Lim and Tremblay concluded by stating, «The renewal of the Agreement on Softwood Lumber until 2015 is good news for those Central Canada companies who continue to export lumber to the extent it provides certainty around access to the U.S. market. Economic analysts forecast a steady and consistent growth in the U.S. home building sector and an increase in consumption forecasted for 2013 should benefit Central Canada companies. »
The Ontario Forest Industries Association, Home to CLA Grading and Inspection, provides a unified voice for the province's forest products sector and represents member companies ranging from large multinational corporations to family owned operations. Today, 200,000 Ontario hard working families in 260 Ontario communities directly and indirectly rely on the forest sector for their livelihoods. Ontario's forest products sector is a world leader in sustainable forest management.
QFIC is the voice of Québec's forest industry. The CIFQ numbers more than 160 regular members operating in the softwood and hardwood lumber, veneer, pulp, paper, cardboard and panel sectors of Québec. Each year, these companies generate $12.9 billion in business and close to $4 billion in wages and benefits, of which nearly $1.5 billion is returned to governments in the form of taxes paid by companies and workers.