OTTAWA, Ont. — According to a spokesman for the U.S. softwood industry, Canadian producers can expect a border tax on Canadian exports if there is to be a quick fix to end the costly trade dispute.

John Ragosta, lead lawyer for the U.S. lumber industry, insists the Canadian government and industry could cave in on every U.S. demand and a border tax would still be required to prevent a surge of Canadian exports while changes were phased in.

“If you want to wrap this up in the next few months, you need some sort of bridging system,” says Ragosta, spokesman for the Coalition for Fair Lumber Imports.

The controversy was sparked when the U.S. government imposed a 19.3 per cent interim duty on Canadian softwood exports in August after complaints from the U.S. industry. After Canadian and U.S. officials met for three days in Toronto last week, federal and B.C. officials reported significant progress toward a deal.

Since then, mills have been cutting production or even shutting, especially in B.C., the leading Canadian exporter. But B.C.’s enthusiasm to negotiate with our neighbors to the south is not shared in eastern Canada. The association representing mainly eastern producers says it is willing to participate in talks but not if they turn to border controls.

“We still believe free trade is the critical objective and getting to unencumbered and unharassed trading relationships is key,” says former Ontario Premier Bob Rae, who acts on behalf of eastern producers. “But we’re certainly prepared to pursue the multi-track process the government has undertaken, litigation at the WTO and these discussions.”

Meanwhile, the U.S. Commerce Department has given Canadian softwood lumber producers another three weeks to file applications to be excluded from the 19.3% countervailing duty.