Stacks of lumber at the WFP Duke Point Sawmill in Nanaimo, B.C., on Oct. 17. The province has cancelled a plan for a digital advertising campaign focusing on softwood duties and tariffs.James MacDonald/The Globe and Mail
The B.C. government has scrapped plans for digital advertisements aimed at U.S. homeowners after Ontario’s anti-tariff ad campaign on American television triggered a backlash from U.S. President Donald Trump.
The new digital ad campaign by the B.C. government had been slated to start running this month in the United States, focusing on increased costs of softwood lumber for American home construction and renovation projects. The ads also were designed to highlight how Canada faces much higher import taxes on lumber compared with Russia.
Last week, B.C. Premier David Eby vowed to press ahead with the digital ads. But B.C.’s goal now is to work in partnership with the federal government on communications strategy in future, Mr. Eby said during a news conference on Monday.
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He made the comment after cabinet ministers from B.C. and Ottawa met in Vancouver for a forestry summit as the industry faces softwood duties and tariffs.
“I knew that it was a source of anxiety for many people, including potentially the federal government, given the reaction” of Mr. Trump to the Ontario campaign, Mr. Eby said.
He compared the importance of the softwood sector in British Columbia with the auto parts and steel industries in Ontario and Quebec. “I feel much more confident the federal government understands the severity of the crisis facing the sector,” Mr. Eby said after meeting with Dominic LeBlanc, the federal minister responsible for Canada-U.S. trade.
“Because the hour is grave, the moment is serious for us to continue to work together and to adjust and to increase the supports that the province and the government of Canada can put in place together,” Mr. LeBlanc said.
B.C. Premier David Eby says plans for anti-tariff digital ads in the U.S. are on pause.
The Canadian Press
Other federal representatives at the summit included Energy and Natural Resources Minister Tim Hodgson and Housing and Infrastructure Minister Gregor Robertson.
Most forests in Canada are on Crown land, with buyers paying “stumpage fees” to provincial governments for the right to log.
The U.S. has levied countervailing duties in retaliation for what it deems to be unfair provincial subsidies produced by the stumpage system. In addition, anti-dumping duties are being imposed in response to Canadian lumber allegedly sold at below-market value.
U.S. import taxes on softwood now total 45.16 per cent on most Canadian producers.
Accumulated U.S. duties paid by Canadian softwood producers since 2017 are now valued at more than US$7.2-billion.
The dispute stretches back to the early 1980s. The last time Canada and the U.S. reached an agreement on softwood trade was in 2006. That deal expired in October, 2015, with no replacement.
B.C. Premier David Eby before meeting Prime Minister Mark Carney in Ottawa in September. He says B.C. now plans to work with the federal government on future communications strategy.Justin Tang/The Canadian Press
The U.S. Department of Commerce levies anti-dumping and countervailing duties totalling 35.16 per cent against most Canadian producers. The Commerce Department raised the duty rates in the summer, up sharply from the previous 14.4 per cent.
Mr. Trump announced new 10-per-cent tariffs on softwood in September against Canada and other countries, citing Section 232 of the U.S. Trade Expansion Act, which allows him to invoke national-security concerns to impose such levies.
“We do raise the importance of coming to a negotiated agreement with the United States on softwood lumber when we talk to them. As you know, those conversations have been suspended,” Mr. LeBlanc said.
The powerful U.S. Lumber Coalition has been an effective lobby group and remains suspicious that the bulk of Canadian timberland ownership is in the public hands of provincial governments.
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Zoltan van Heyningen, the coalition’s executive director, said the duties and tariffs are necessary.
“Canada should reverse its massive lumber subsidy programs and should stop treating the U.S. market as its dumping ground for Canadian lumber,” Mr. van Heyningen said in a statement on Monday. “I think Canada should stop complaining about being subject to U.S. trade laws and instead put that energy into eliminating its unfair trade practices.”
In August, Prime Minister Mark Carney announced plans for supporting Canada’s softwood sector. Ottawa’s $1.2-billion financial package includes $700-million in loan guarantees to help Canadian lumber producers with operations and $500-million in grants and contributions in a bid to diversify markets and reduce dependence on the U.S.
Last month, the Business Development Bank of Canada began rolling out the loan package, inviting Canadian lumber companies to apply for assistance.
Two major Vancouver-based companies are facing different rates under the Commerce Department’s calculations. Canfor Corp. is now paying total levies of 57.59 per cent, including the new 10-per-cent tariffs, while U.S. import taxes against West Fraser Timber Co. Ltd. now total 36.47 per cent.
West Fraser recently announced its financial results, saying that it lost US$204-million in the third quarter, compared with a US$83-million loss for the same period last year. The company reported that it has paid US$971-million in lumber duties since 2017.