The standstill agreement on softwood lumber trade expired recently, leaving Canadians holding their breath for the U.S. Lumber Coalition to launch legal proceedings.
In the calm before the storm of the next Canada-U.S. softwood lumber dispute, speculation about how the issue will unfold has crystallized around two options: a tax or a quota. The differences may appear merely technical, but they would mean vastly different things economically.
While a quota would impose a cap on exports to the United States, a tax would allow the level of exports to fluctuate with U.S. consumers’ willingness to pay for Canadian lumber. In other words, as U.S. lumber prices increase, Canadian lumber would still be able to enter the U.S. market to meet demand.
Members of Maine’s forest products economy are hailing the certification of Norway spruce as construction lumber – the first new species to be added to the list of approved lumber in about 80 years.The pretty evergreen with its gently sloping boughs was named to the list after five months of testing at the University of Maine. Researchers tested more than 1,300 pieces of lumber milled from Norway spruce grown in Maine, Vermont, New York and Wisconsin. On Oct. 20, the American Lumber Standards Committee approved the inclusion of Norway spruce for home construction and industrial applications.
With the U.S. Lumber Coalition free to file a new trade case against Canadian lumber producers as early as October 13, share prices across the sector are expected to come under pressure.