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October 12, 2010

U.S., Canada in talks over lumber prices

By The Mainebiz News Staff

Federal trade officials are looking into whether British Columbia is violating a U.S.-Canada agreement by providing an additional subsidy to its softwood lumber producers.

The United States Trade Representative's Office has requested consultations with Canadian officials to determine if the province has been under-pricing timber harvested in the region, resulting in hundreds of millions in additional subsidy dollars and violating the U.S.-Canada Softwood Lumber Agreement, according to press releases from the Trade Representative's Office and the U.S. Coalition for Fair Lumber Imports. The two countries have been in talks about the under-pricing issue but have been unsuccessful in reaching an agreement, and the consultation period opens a formal dispute settlement process, according to the office's release. If the issue is not resolved during consultations, either country can request arbitration.

The softwood lumber agreement, signed in 2006, was intended to offset unfair subsidies on Canadian timber sold to lumber producers, which U.S. producers said have harmed domestic production and dampened sales of lumber from Maine and other states.

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