Softwood Lumber

Topics: International trade, United States, World Trade Organization Pages: 3 (996 words) Published: May 21, 2006
Canadian government owns almost 94 % of the forestry land. softwood lumber is the one of the biggest export products of Canada valuing at 8.6% of total exports. Canadian softwood lumber is sold to united stated below the production cost. Due to market distortions in Canada encourage the government to overproduction of lumber, uneconomic decisions by lumber producers, and dumping of lumber in us. The US markets were bombarded with profit loss due to the cheap lumber from Canada; therefore the start of lumber dispute began. There has been numerous of disputed for almost 20 years. United States is saying that Canadian government is promoting unfair production of lumber. While on the other hand, Canadian is denying that statement. The softwood lumber dispute was one of the biggest events, which devastated the Canadian economy. An Overview of the softwood Lumber Dispute The softwood lumber dispute is a controversial topic in Canada history effecting both Canada and the United States. The history of the softwood lumber dispute between Canada and the United States has lasted for almost 20 years. The softwood lumber dispute affected British Columbia greatly due to the job loss in lumber industry. softwood lumber made up most of the exports in BC. The Canadian economy is completely dependent on the US for the exporting. The trade dispute is just the start of event which can occur all around the world. This dispute was mainly based on softwood timber fees, regarding the amounts that were being charged to companies, who exported lumber. In fact many people in the U.S. saw this as a threat to their economy because the Canadian stumpage fees were too low. The U.S. wanted Canadian lumber producers and the provincial government to sell the softwood lumber at market prices. Resulting in the U.S. to charge tariffs on imported Canadian softwood .This power struggle between Canada and the United States over softwood lumber has had a huge impact on the economy. A country often puts...
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