A report issued by the Free Trade Lumber Council, Ontario Forest Industries Association and Ontario Lumber Manufacturers Association alleges that companies may not receive loan guarantees or other financial assistance from the government unless they accept the terms of the deal.
It claims the agreement has compromised the industry’s interests and gives US$500m of Canadian companies’ money, duties collected by America on softwood lumber shipments, to US competitors.
The deal, which may take three months to finalise, includes the return of US$4bn in duties to Canadian firms and unrestricted aceess to the American market under current market conditions. But Canada will have to cap its exports at 34% of the US market and impose a sliding tax to stop companies exceeding the quota.
Meanwhile, the Conference Board of Canada has said the deal will only modestly improve Canadian lumber industry profits this year because of a slowdown in the North American housing markets and the strength of the Canadian dollar.
