Stacks of lumber are shown at NMV Lumber in Merritt, B.C., Tuesday, May 2, 2017.Jonathan Hayward/The Canadian Press
The federal government is asking the Trump administration to exempt a wide range of items subjected to U.S. duties on Canadian softwood lumber, including bed-frame components, garage doors and window frames.
The Canadian government's list of wooden products proposed for exemption also covers door frames, clothes hangers, cutting boards, butcher-block countertops and certain fence pickets. Ottawa points out that the vast majority of exemptions envisaged are for remanufactured products made from softwood boards, versus lumber derived from trees and sent to U.S. home-construction sites.
Another exemption sought is for Western Red Cedar exports. "Western Red Cedar commands a significant price premium to other softwood-lumber products and is not considered by purchasers to be interchangeable with other softwood species," the federal government said in a letter to U.S. Commerce Secretary Wilbur Ross.
Ottawa is pressing its case as the Alberta government steps up its defence of the forestry sector, with Premier Rachel Notley naming Gary Doer as the province's envoy on the softwood file. The former Canadian ambassador to the U.S. joins trade envoys previously appointed by British Columbia, Quebec and Ontario to help the federal government advocate for Canada's softwood exports south of the border.
In its submission to Mr. Ross, Ottawa said the lumber dispute should be mainly about spruce, pine and fir (SPF) used in residential construction.
The U.S. Department of Commerce imposed preliminary countervailing duties effective April 28 on Canadian softwood shipments in retaliation for what the Trump administration calls unfair subsidies in Canada.
U.S. producers say that under their system, the cost of timber rights on private land is more expensive than the Canadian "stumpage" fees paid by forestry companies to cut trees down on provincially owned property. In B.C., for instance, Crown timber accounts for 95 per cent of the province's forested lands.
Ottawa argues that the U.S. lumber industry is focused mostly on targeting softwood lumber for building houses and renovation projects.
U.S. lumber producers want unassembled pallet components to continue to be subject to duties. But the American coalition-led group agrees with Ottawa that items such as bed-frame components and a certain type of floor joist should be exempt. U.S. bed manufacturers have asked that wooden bed-frame parts be excluded from U.S. duties.
"Petitioner's claims centre on the allegation that Canadian governments unfairly subsidize the purchase of standing timber used to produce such structural boards. Remanufactured products made from softwood boards, rather than standing timber, are not the focus of Petitioner's claims," lawyers for Ottawa said.
Five forestry firms in Canada must pay duties ranging from 3.02 per cent to 24.12 per cent on lumber shipments, while the U.S. Department of Commerce slapped other Canadian producers with a weighted average duty of 19.88 per cent.
"The Department should recognize that remanufactured lumber constitutes a separate class or kind of merchandise that is entitled to its own subsidy rate if it remains within the scope of the investigations at all," the Canadian government said.
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Brent Jang