VANCOUVER, (June 4, 2004) — The U.S. Commerce Department announced yesterday it will cut duties on imported Canadian softwood in half — marking a significant blow to the American lumber industry’s lobbying efforts to restrict Canadian competition to the crucial U.S. market.

In May 2002, the Commerce Department imposed countervailing and anti-dumping duties averaging 27.2 per cent after accepting U.S. industry complaints Canadian lumber is subsidized, mainly through low provincial Crown timber-cutting fees or stumpage. Although the decision is still subject to appeal, officials said it was more evidence that the U.S. industry’s argument of unfair Canadian trade practices is slowly crumbling.

After reviewing lumber shipments between the initial levy in 2002 and March 31, 2003, Commerce cut the total duties to 13.2 per cent. The final rate will be determined after Commerce completes its final administrative review in December.

“This shows that the duties imposed on the Canadian industry were unreasonable,” International Trade Minister Jim Peterson was quoted by Canadian Press. “I’m pleased with the finding, but I won’t be satisfied until all unfair duties are removed and the money is given back to our industry.”

The decision comes on the heels of a string of favourable rulings in Canada’s legal challenges to the duties before the World Trade Organization and a North American Free Trade Agreement appeal panel.

Canada exports about $10 billion worth of lumber to the United States and has about a third of the American market.

— from Canadian Press