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Export trade vital to the lumber industry
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Canada’s 418 million hectares of forests cover almost half the country’s landscape. This wealth of forests has allowed the lumber industry to become a force in the Canadian economy and a major exporter.
In 2004, two-thirds of all the lumber produced in Canada was exported to other countries. The value of these exports was more than $12 billion. Exports are particularly important on the West Coast. In 2004, British Columbia produced almost half of Canada’s lumber and exported more than four-fifths of its total production to other countries.
The United States has always been the chief destination for our lumber exports. In 2004, we exported $10 billion in lumber to the United States. That dependence on exports to the United States has increased in recent years, as other markets such as Japan and some of the European Union reduced their demand for Canadian lumber. In 2004, the United States represented 81% of our lumber export trade, up from 67% in 1995.
Since 2001, a trade dispute over softwood lumber has stymied the growth of lumber exports to the United States. In May 2002, the American government alleged that Canadian exporters were selling products below market value and placed a 27% duty on imports of softwood lumber from Canada.
American producers have long complained that our provincial systems of selling timber rights amount to unfair subsidies. Canada has fought these charges through both the North American Free Trade Agreement and the World Trade Organization. Canada and the United States reached an agreement to end this trade dispute in April 2006.
