10.21.16

Daines Demands Response to Lapsed Softwood Lumber Agreement

Moratorium on litigation related to U.S. - Canada softwood lumber trade lapsed at midnight, October 12, 2016 

U.S. SENATE — U.S. Senator Steve Daines today joined 26 Senators in urging President Obama to prioritize ongoing negotiations to obtain a new softwood lumber trade agreement with Canada.  

In a letter to President Obama, Daines underscored the need to reach a new deal to prioritize American jobs and help forested counties. 

“We are disappointed that Canada appears reluctant to follow through on this commitment which has significantly undermined USTR’s efforts to reach a final agreement," Daines wrote. "We urge you to encourage Canada to fulfill Prime Minister Trudeau’s commitment as contained in the Joint Statement and bring the negotiations process to successful conclusion with a new, stable, and sustainable agreement.”  

A timeline of Daines’ efforts to renegotiate a new SLA for Montana’s sawmills is below: 

April 27, 2006: SLA signed – seven year agreement that went into force on October 12, 2006

January 23, 2012: SLA extended until October 12, 2015. 

September 17, 2015: Daines sent a letter to U.S. Forest Service Chief Tom Tidwell urging him to provide much needed certainty for Montana sawmills facing the expiration of the SLA. 

October 12, 2015: Expiration of the SLA. 

October 21, 2015: Daines met with Canadian Ambassador Gary Doer to urge him to begin negotiating a new SLA.

December 3, 2015: Daines wrote newly elected Canadian Prime Minister Justin Trudeau to emphasize Montana priorities and ensure continued economic growth on both sides of the northern border. 

February 22, 2016: In advance of Canadian Prime Minister Justin Trudeau’s first state visit to Washington, D.C., Daines urged the USTR to prioritize Montana issues in discussions with Canada.  

June 23, 2016: Daines spoke to United States Trade Represetnative Ambassador Froman regarding SLA in advance of President Obama and PM Trudeau meeting in Ottawa.

July 19, 2016: In a letter to U.S. Trade Ambassador Michael Froman, Daines pushed for a new SLA with Canada.  

September 13, 2016: Daines met with Gitane De Silva, Alberta’s new Senior Representative to the United States to discuss the expiring SLA.

October 13, 2016: Daines issued a statement at midnight at the expiration of the moratorium on trade litigation related to the SLA. 

The full letter is available to download HERE and below:

Dear President Obama:

We are writing with regard to ongoing negotiations to obtain a new softwood lumber trade agreement with Canada.  We appreciate the efforts by you, Ambassador Froman and others in the Administration to insist on an agreement that will fully and effectively address the market effects of subsidized Canadian lumber exported to the United States.  We also welcome the commitment made by you and Prime Minister Trudeau in June to seek a new agreement with “an appropriate structure, designed to maintain Canadian exports at or below an agreed U.S. market share to be negotiated, with the stability, consistency and flexibility necessary to achieve the confidence of both industries.”  We are disappointed that Canada appears reluctant to follow through on this commitment which has significantly undermined USTR’s efforts to reach a final agreement.  We urge you to encourage Canada to fulfill Prime Minister Trudeau’s commitment as contained in the Joint Statement and bring the negotiations process to successful conclusion with a new, stable, and sustainable agreement.

Under the terms of the now-expired 2006 Softwood Lumber Agreement (2006 SLA) the U.S. industry is precluded from filing new antidumping and countervailing duty cases until after October 12, 2016, one year after the expiration of that agreement.  We had hoped that Canada would use this one-year period to negotiate a new agreement consistent with the commitment you made with Prime Minister Trudeau.  Only this type of agreement will allow U.S. lumber mills the opportunity to compete fairly in our own market and to make the investments necessary to grow the domestic industry to its natural levels of production and employment. 

We are concerned, however, that since you and Prime Minister Trudeau announced this shared goal the Canadian government has been unwilling to put forth or seriously consider proposals consistent with that statement. In contrast, we understand that the U.S. government has submitted detailed proposals to the Canadian government that would establish an agreement consistent with the terms of the Joint Statement. These proposals are designed to ensure that Canadian lumber imports would enter the U.S. market at or below an agreed U.S. market share and to provide appropriate flexibility for the Canadian government to administer such a program.  Most importantly, the agreement would provide stability and certainty for the industries on both sides of the border. We appreciate these efforts by U.S. negotiators and urge the Administration remain firm in its resolve to obtain an agreement fully consistent with the goals established by you and Prime Minister Trudeau. 

Further, if an agreement cannot be reached with the Canadian government that is fully consistent with these principles and the U.S. lumber industry exercises its rights to file new trade cases, the U.S. trade laws must be fully enforced to respond to subsidized and dumped Canadian lumber imports. 

The U.S. – Canada softwood lumber trade issue is foremost a jobs and fairness issue.  Hundreds of thousands of U.S. jobs and thousands of U.S. rural communities depend on fairness in trade in softwood lumber.  That is why we will continue to urge you, and any future Administration, to seek a fair, effective, and sustainable agreement with Canada on softwood lumber trade, and in the absence of such an agreement, to fully enforce U.S. trade laws.

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