U.S. and Canada Extend Softwood Lumber Agreement to Oct 2015
The Office of the U.S. Trade Representative has issued a press release announcing that on January 23, 2012, the U.S. and Canada signed a two-year extension of the 2006 U.S.-Canada Softwood Lumber Agreement (SLA). As a result, the 2006 SLA will be in effect through October 12, 2015 (rather than through October 12, 2013).
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SLA Extended with No Changes
The SLA is being extended with no changes. According to the USTR, the extension of the SLA well before its initial expiration date ensures predictability and stability in the sector. The U.S. intends to consult with Canada before the extended expiration date on whether a further extension is in the interest of both countries.
SLA Constrains Softwood Lumber Exports from Canada when Demand Low
The U.S.-Canada Softwood Lumber Agreement settled litigation in U.S. and international venues and resulted in the revocation of antidumping and countervailing duty orders on softwood lumber from Canada. The SLA is designed to constrain softwood lumber exports from Canada into the U.S. when demand in the U.S. is low. In favorable market conditions, the SLA provides for unrestricted trade in softwood lumber.
As part of the SLA, the U.S. agreed to cease the collection of antidumping and countervailing duties upon softwood lumber from Canada and to refund $5 billion in deposits of duties. In exchange, Canada agreed, among other things, to apply export measures -- export charges and volume limitations -- to shipments of softwood lumber from Canada to the U.S. when the price of softwood products falls below a certain level.
(See ITT’s Online Archives 11091524 for summary of the USTR’s request for comments on a possible two year extension of the SLA.)
Press release from Senate Finance Chairman Baucus (D-MT) applauding the extension available here