The U.S. lumber industry seeks to level the playing field against subsidized and unfairly traded Canadian softwood lumber. The U.S. industry believes that the compromise U.S.-Canada Softwood Lumber Agreement (SLA) can provide a level playing field against subsidized Canadian lumber as long as all parties honor their commitments under the agreement. It is only on this basis that the SLA can serve as a lasting alternative to trade litigation.
The SLA 2006 came into effect October 12, 2006 and is to last seven-to-nine years by terms of the agreement. Under the SLA 2006:
The export tax rates and quota volumes fluctuate depending on the level of lumber prices, becoming more restrictive during periods of low prices when government subsidies give Canadian lumber mills the greatest protection from efficient U.S. mills and cause U.S. workers the most harm.
|Random Lengths Framing Lumber Composite Price
Export Charge Plus Quota
||0% + no quota
|US$336 to US$355/mbf
||2.5% + regional share of 34% of U.S. consumption
|US$316 to US$335/mbf
||3.0% + regional share of 32% of U.S. consumption
|US$315 or under
||5.0% + regional share of 30% of U.S. consumption