44th Parl. 1st Sess.
April 8, 2024 11:00AM
- Apr/8/24 6:21:03 p.m.
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moved:
That this committee take note of softwood lumber.
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- Apr/8/24 6:31:52 p.m.
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Madam Chair, this has been an ongoing problem since the 1980s. I believe we are on the fifth round of negotiations around softwood lumber. It is an important issue in the province of Quebec, and it is certainly one I am following closely. Indeed, we have seen the Prime Minister and our ministers engage very closely with their counterparts on this issue.
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- Apr/8/24 6:32:29 p.m.
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Madam Chair, I think this is such an important issue, especially where I live in Port Alberni and the Alberni Valley, and on Vancouver Island. It is an issue where we actually need all sides to work together. This should not be a partisan issue. This should be all of us hammering Washington.
Over the last four decades plus, we have seen both Liberal and Conservative approaches in terms of their failed resolution to the softwood lumber dispute. The Liberal approach can be described as winning in court, but still losing as the U.S. has continued to levy tariffs against Canadian softwood lumber. The Conservative approach can be best described and characterized as appeasement through agreements, where Canada would not only impose an export tax on softwood lumber, but in return, the U.S. would remove its duties.
What new approach is the government going to bring? The sense of urgency is real. We have the first new mill in 15 years on Vancouver Island in my community, and it is struggling right now. The tariffs are crippling, and the sense of urgency is real.
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- Apr/8/24 6:36:59 p.m.
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Madam Chair, the NDP members, particularly from B.C., should talk to their provincial government about getting more access to fibre. That is entirely a provincial problem and one of the NDP's own making in British Columbia. On the one hand, we have NDP governments limiting access to fibre, and on the other hand we have a Liberal government that is limiting our ability to market the softwood lumber around the world, particularly to the United States.
I do recall something that was called a “bromance” between the Prime Minister and Barack Obama when he was the prime minister. It was a complete failure by the current Prime Minister to get a softwood lumber agreement when Obama was in power.
What does the member have to say about that?
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- Apr/8/24 6:40:31 p.m.
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Madam Chair, I am going to be sharing my time with the member for Prince Albert.
What we have here with the softwood lumber dispute is—
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- Apr/8/24 6:47:09 p.m.
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Madam Chair, the team Canada approach is one part of that, which should take place. The Liberals are failing miserably on that because they are not getting that groundswell of support in the United States to bring that pressure upward. The real issue is that, ultimately, the American president has to force the United States softwood lumber industry into an agreement because it has legal rights to continue to pursue action. Those rights have to be negotiated away. That is what happened when we had lumber peace under former Prime Minister Harper. The only way to do that is to get the president involved.
The President of the United States will not get involved in this dispute because the Prime Minister has bungled the relationship so badly and our trading relationship has declined so precipitously that he could not be bothered. The only way to fix it would be to change the leader at the top. Thank goodness, when there is a carbon tax election, we will fix it. We will get the softwood lumber dispute resolved quickly; mark my words.
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- Apr/8/24 6:51:03 p.m.
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Madam Chair, I rise today to speak to the softwood lumber dispute between the United States and Canada, and the over $8 billion in tariffs that the Americans have collected from Canadian businesses.
As adviser to the leader of the official opposition on Canada-U.S. relations, I wish to give my unique perspective on what I have learned in Washington and on the challenges that the Liberal government has created in reaching a negotiated deal.
This situation is one of the Prime Minister's own doing, and it is reflective of his lack of care for the forestry sector as a whole and for the thousands of Canadians who are impacted.
There has been $8 billion in tariffs collected as a direct result of the Liberal government's failure to prioritize Canadian workers, indigenous communities and our natural resource sector. It did not need to be like that. There is a desire on both sides of the border to resolve this matter, as Americans and Canadians recognize the importance of the industry. There is no excuse for not reaching a negotiated deal.
Over the last 42 years, Canada and the United States have reached agreements on softwood lumber. The most recent agreement, softwood lumber agreement five, was in place from 2006 to 2016.
SLA 5 was in place because the former Conservative government understood the importance of the forestry sector to Canada. We understood that the forestry sector was mutually beneficial to both Canada and the United States. When we went to Washington, we made sure that we worked collaboratively with our American partners to reach an agreement.
The Liberal government has done the exact opposite. It has completely ignored the situation and has refused to address the dispute at the highest levels of government. When the agreement expired in 2016, the Liberal government should have made it a priority to negotiate a resolution with the Americans, but instead, it delayed and looked the other way.
As the years passed, the hon. ministers of international trade blamed the American government, claiming there was no desire to resolve the dispute in Washington. I wish to contest that point. Over the years, American legislators, associations and companies have publicly made it quite clear that they want the softwood lumber dispute resolved, and for good reasons.
The United States does not produce enough lumber for its own needs. In a letter dated May 17, 2021, addressed to the United States Trade Representative, Katherine Tai, over 90 members of both parties in the House of Representatives urged the U.S. federal government to resolve the matter with the Government of Canada, saying, “We now call upon you to represent American interests on this critical issue by pursuing a balanced agreement with Canada. We, as Members of Congress, stand ready to discuss this issue and potential solutions with you.”
Additionally, on May 12, 2021, members of the United States Senate Committee on Appropriations wrote to the Secretary of Commerce and USTR Tai, saying, “We write to urge you to take action to resolve the longstanding trade dispute between the U.S. and Canada on softwood lumber” and also saying, “These imports are vital to support the ongoing housing boom”.
It has not been American denial. It has been the Liberal government's refusal to acknowledge the issue at the highest levels of government and to advocate effectively for a solution to the softwood dispute.
Most interestingly is that the Standing Committee on International Trade published a report in November 2023 analyzing the problem and the possible remedies. During those hearings, Government of Canada officials noted that the Minister of International Trade raised the issue of the current dispute directly with President Biden. She raised the issue.
According to officials at Global Affairs Canada, the Prime Minister also emphasized the harm of American tariffs on Canadian softwood lumber producers and employees, yet in the report, recommendation 4 states, “achieving an agreement with the United States regarding trade in softwood lumber products ultimately will occur only through direct head-of-government negotiation”, and it also says, “the...softwood lumber dispute should be made a high-level priority in dealings with the U.S.”
They had the President of the United States in Ottawa last March, yet again, the Liberal government failed to advocate for Canadian jobs and Canadian interests adequately.
This report, the timeline and the situation we currently find ourselves in demonstrate that the Prime Minister has routinely failed to resolve the dispute and has failed to make the interests of Canadian workers a priority when dealing with the United States.
The previous Conservative government successfully negotiated a deal, yet the Prime Minister has failed to provide the attention this dispute so desperately requires over the last five years.
Why has he continued to fail to negotiate a deal if these Canadian jobs are so important to the Prime Minister? Why does the Liberal Government not give the issue the attention it desperately needs?
The softwood lumber dispute will not resolve itself overnight. It requires actual leadership to get it done. We, as Conservatives, know that we can get it done. We also know that the Prime Minister is just not worth the cost.
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- Apr/8/24 6:55:58 p.m.
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Madam Chair, there were a couple of things in his speech. This is something that is not going to happen overnight, but indeed, it has been a long-standing dispute for a number of reasons. However, Canada has won in the arena of the neutral international trade dispute organizations.
I would like to hear his comments about that, and also hear why Conservatives voted against supports, time and time again, that our government put forward for the softwood lumber industry.
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- Apr/8/24 6:57:46 p.m.
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Madam Chair, I thank my colleague, a fellow member of the Standing Committee on International Trade in the last Parliament. I think we were both on the committee together in this Parliament, and I believe he was there when I moved the softwood lumber motion he just quoted. We have even been on one or two missions to Washington together. We advocate for this issue there a lot.
Financial support for oil is in the billions of dollars; for forestry, it is in the millions of dollars, and most of that is in the form of loans. Does my colleague agree that there is a bit of an imbalance here?
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- Apr/8/24 6:59:19 p.m.
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Madam Chair, the Conservatives keep going back to when they were in power. They gave away a billion dollars U.S. of collected funds, which legitimately belonged to Canadian softwood lumber producers, and about half of that amount went to the U.S. lobby group that started the whole thing. In the agreement, they sent half a billion dollars to those lobbyists. Does my colleague think that was a good deal? Is that what Conservatives want to bring back?
Conservatives taxed our producers with that deal, and I have not heard them come forward with a proposal that is not going to revert back to their failed deal when it was Prime Minister Harper or Prime Minister Mulroney. That is 42 years of failure. They cannot absolve themselves of it.
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- Apr/8/24 7:10:15 p.m.
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Madam Chair, this agreement has been very problematic. It has divided the sector and the regions, and has objectively cost the sector. I recognize that progress has been made. For example, the Conservatives have not said that the softwood lumber crisis started because of the carbon tax. I will give them that. At this point, it is fair game to say that things were going better when they were in power, except that the softwood lumber crisis has been going on for 40 years. In some cases, they tried to plug the holes, but they got it wrong. This has been going on for 40 years, and that is the crux of the problem.
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- Apr/8/24 7:15:10 p.m.
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Madam Chair, I thank my colleague for his very interesting speech.
We know full well that the softwood lumber dispute is causing considerable harm. I would like my colleague to say more about this harm and about the impact that the U.S. administration's findings and decisions since February 1, 2024 are having on the softwood lumber industry.
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- Apr/8/24 7:17:51 p.m.
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Madam Chair, I want to begin by saying that my colleague is probably right about that.
On various missions to the U.S., including missions I went on with colleagues from other parties in the House, missions with the Canada-U.S. Interparliamentary Group and in the meetings we held, whether with senators or U.S. representatives, I was pretty much the only one who raised this issue, which says a lot. It is worth mentioning.
Allow me to repeat some of the examples I gave earlier. Softwood lumber was not on the agenda at the WTO in Abu Dhabi last month. In 2021, when the increase in countervailing duties was announced, the government was busy panicking over the electric vehicle issue and did nothing at all about softwood lumber. The House adjourned, and the words “softwood lumber” were nowhere to be seen in the paragraph devoted to American protectionism. A few weeks after the announcement of new countervailing duties, and the words “softwood lumber” do not even appear in the paragraph about American protectionism in the mandate letters. I do not know what happened there.
Obviously, there is work to be done to raise awareness among the American citizens. The National Association of Home Builders in the United States is doing a remarkable job, but we need to pull out all the stops.
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- Apr/8/24 7:40:07 p.m.
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Madam Chair, I will be sharing my time with the member for Kenora.
We come forward tonight talking about the softwood lumber issue. It has been an issue I have been very close to for most of my life. My first job out of high school was working at the local pulp mill in construction in Taylor, B.C. That is where I learned to work hard, building the mill that was going to cost $150 million but provide hundreds of jobs over generations using residual fibre, which normally would just be waste fibre, from the local mills. However, what we have seen from the current Liberal-NDP government, and the provincial NDP government particularly in my province, is inaction on the softwood file.
Let us put this into context a bit first, because I think folks out there wonder what softwood lumber means. For me, it means jobs. I have already said that I have worked in the softwood sector, working on one of the mills. My kids have all worked in it, whether it was for a logging company, working on trucks, or at an OSB mill. We are all very familiar with the forestry sector.
However, a CBC article on January 11, 2023, reported, “‘We expect about 300 jobs in Prince George will be lost across the Canfor Pulp organization with the shutdown of the pulp line at PG Pulp and Paper Mill. This includes staff and hourly positions,’ a spokesperson for the company said in an emailed statement.” The CBC, on January 25, 2023, reported, “In an email to CBC News, Canfor said its plants in Chetwynd employ 157 people, adding that ‘where possible, employees will be prioritized for hiring and redeployment to other Canfor locations.’” This was after it was announced that Canfor would shutter that particular mill, which was absolutely the backbone of Chetwynd. I recently talked to one of the former councillors in Chetwynd, and the parent has to go work in northern Alberta now, because there is no longer a mill for her dad to work at.
These were two different mills, both in my riding. Of Houston, B.C., which is slightly out of my riding, Canfor said, “it is too early in the project planning to fully understand how many of the 333 employees who work at that facility will be laid off.” Energetic City, in September 2022, reported about the mill that I worked at growing up, “In May, the company stated that the curtailment would most likely stay in place until the fall. At this time, Ward had confirmed that around 80 employees had been affected, saying the company ‘sincerely regrets its impact’” and that another 20 jobs would be lost.
This all comes around to the inaction on the softwood lumber file. I was criticizing the trade minister for her lack of action. I would ask her regularly, when she was meeting with our trading partner, Katherine Tai, on the U.S. side, whether she was actually negotiating the softwood lumber agreement. I would constantly get no answer back. We know in this place that when someone is not answering, it probably means it is not being discussed. On May 16, 2021, CTV reported from Washington:
Tai told U.S. senators that despite higher prices, the fundamental dispute remains and there have been no talks on a new lumber quota arrangement.
“In order to have an agreement and in order to have a negotiation, you need to have a partner. And thus far, the Canadians have not expressed interest in engaging,” Tai said.
This was in 2021. Now the government has come to the table, and it is finally talking about softwood lumber. That is great, but what happened about six years before? It did absolutely nothing about it, and that is why our mills were closing. This is the government's game: protecting 25% of lands and waters by 2025 and upping that to 30% by 2030. It is all part of the game to shut this stuff down with a bunch of other different excuses as the reason to do so. What we need is better forest management, and according to Jesse Zeman, “Forestry could play a critical role in mitigating the effects of wildfire by reducing fuel loads and thinning forests.”
It is about time we had a government that takes our softwood sector seriously, and I hope that with this conversation we cause the government to do so.
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- Apr/8/24 7:45:01 p.m.
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Mr. Chair, I listened to the speech of my colleague with great interest. Clearly, he wants to tell us that he supports the softwood lumber industry, and I know the Conservatives in general talk a big game when it comes to supporting the industry and Canadian workers, but unfortunately it is all talk and no action. We hear a lot of buzzwords, and we hear a lot of slogans, but the simple fact of the matter is that, when it came to voting for funding support for the management of the Canada-U.S. softwood lumber file, every single Conservative in the House voted against it. Therefore, I would like to know how the member can defend that vote to the companies and workers they care so much about.
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- Apr/8/24 7:45:58 p.m.
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Mr. Chair, it would be funny if it were not so sad. Here is a member of a government that has done absolutely nothing, and I just proved it. The minister responsible did nothing for six years, even as evidenced by Katherine Tai, the U.S. trade secretary. It did nothing when we got it done within six months.
Here is a government that has done absolutely nothing. It has been the government for almost nine years, and it is still not there. We got it done within six months. We did pretty well. My hope is that the officials get to the U.S. and negotiate a softwood lumber agreement.
With respect to the mills that I talked about, I am seeing jobs being lost by the hundreds in my very own riding. Mills are being shut down by the hundreds. Is it for a lack of trees? I fly over our forests twice a week, and there are lots of trees in British Columbia. We just need to make sure that the companies have a reason to go in and log.
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- Apr/8/24 7:49:23 p.m.
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Mr. Chair, I appreciate what the member has to say, but from my perspective, I just read many news articles talking about literally hundreds of jobs being lost in the current situation without a softwood lumber agreement. Again, when we came into government in 2006, it was done within six months. That is what we are proposing. We would get it done again, and we would bring it home.
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- Apr/8/24 7:57:08 p.m.
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Mr. Chair, I would like to ask my colleague what he thinks of the fact that softwood lumber was not mentioned in either the minister's mandate letter, or the agenda for the WTO ministerial in Abu Dhabi. In both cases, it was a month after the announcement of new countervailing duties. The Liberals agreed to holding this take-note debate more than two months after we started talking about it.
Are we witnessing a rather clear display of this government's complete disinterest in this issue?
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- Apr/8/24 8:00:24 p.m.
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Mr. Chair, Canada and the United States are close neighbours with an unprecedented, mutually beneficial relationship when it comes to trade. That said, as we all know, even among good neighbours, irritants are bound to arise. The softwood lumber dispute with the United States is a long-standing trade irritant that, unfortunately, has resurfaced on several occasions. We are in the fifth round of the dispute since the 1980s. In past rounds, we have seen a certain pattern develop.
First, unfair U.S. duties are imposed against Canadian softwood lumber products at the behest of the U.S. lumber industry. Canada then prevails in contesting these unwarranted duties in neutral international fora. Finally, a negotiated outcome providing predictability and stability to the sector is reached. Right now, we are in the second phase, a phase of active litigation to vigorously defend the interests of our world-leading softwood lumber industry.
Members should make no mistake: This trade dispute negatively impacts the Canadian softwood lumber industry, which is a key component of our highly integrated forest sector. Nowhere is it more important than Surrey Centre, a riding that has the highest number of softwood lumber employees per capita in Canada, or at least in British Columbia. The softwood lumber industry provides thousands of jobs across the country and is an economic anchor to many communities, particularly in rural regions.
Canada is a trading nation, and our softwood lumber industry is no different. Almost two-thirds of the total softwood lumber production in Canada is exported. The United States is our largest export market. Unfair U.S. trade measures on most of Canada's softwood lumber exports not only undermine our industry's competitiveness in the U.S. market but also affect communities and workers at home.
Our government recognizes this burden; at every step of the way, we have supported our industry, our communities and our workers. Our government is mounting a strong legal defence of Canada's interests against the U.S. duties, in close collaboration with provincial governments and industry stakeholders.
That is why Canada currently has a total of 13 ongoing legal challenges against the U.S. duties. The hon. Minister of Export, Promotion, International Trade and Economic Development recently announced the latest of our challenges, which contests a biased U.S. decision to maintain both anti-dumping and countervailing duties on Canadian products instead of revoking them.
The government has contested every single U.S. decision that has led to the imposition or maintenance of unfair trade measures on our softwood lumber industry. These legal challenges are being heard through various venues. Most of Canada's challenges are proceeding under chapter 19 of NAFTA or chapter 10 of its successor, CUSMA. We have two ongoing challenges through the WTO dispute settlement mechanism and one that is being heard by the U.S. Court of International Trade.
Through the many iterations of this dispute, Canada has consistently been found to be a reliable and fair trading partner, while U.S. duties have repeatedly been judged to be inconsistent both with U.S. law and the United States' international trade obligations. We are confident that this will ultimately be the outcome once again. In fact, we have already seen a number of decisions in Canada's favour in the current round of this dispute. We know that the facts and the law are on our side, and we will never waver in our support of Canadian businesses and our workers.
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- Apr/8/24 8:04:27 p.m.
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Mr. Chair, I want to thank the member for reading PMO speech number six.
Where we are is that this is catastrophic for the softwood lumber industry in Canada. While these members talk about how the wheels are in motion and how the dog ate their homework, 183 companies in the forestry sector have gone bankrupt since 2016, with tens of thousands of jobs, real livelihoods. In 2016, we had the expiration of the softwood lumber agreement that was put together by former prime minister Harper.
What they are doing is not working. It has been almost nine years. This has cost the sector billions of dollars and hundreds of thousands of jobs.
What are they going to do differently, other than talk and talk?
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