BILLINGS, MT – Montana’s Congressman, Denny Rehberg, is urging U.S. Trade Ambassador Ron Kirk to extend the U.S. Canada Softwood Lumber Trade Agreement for two  additional years and to ensure that the alleged violations of the agreement be fully addressed in a timely manner.  Rehberg, a member of the House Lumber Trade Caucus, which defends U.S. companies in the enforcement of U.S. trade laws and forestry-related trade agreements, joined other members of the caucus in expressing concerns with the current pact while the U.S. Commerce Department considers approving the 2-year renewal option that would extend the agreement through 2015.  Montana is currently celebrating Montana Forest Product Industry Week, which runs from October 16-22.

“Trade agreements should operate on a level playing field -- for both sides,” said Rehberg. “Montana timber workers are rightly concerned about how the softwood lumber agreement is administered.  I want to make sure Ambassador Kirk and the Canadian government understand those concerns and address them.  The timber industry means good paying jobs for Montana and I’m going to keep fighting for those jobs.”

In the letter, Rehberg and his House colleagues specifically question the low “stumpage fees” (for the right to harvest timber on public lands) charged by the Canadian government, arguing that the fees are an illegal subsidy that gives Canadian companies an unfair advantage over U.S. timber companies. The letter also questions the increasing amount of Canadian timber harvests classified as salvage, which artificially weakens the market for U.S. products.

“The Softwood Lumber Agreement provides critical value to Montana’s forest products companies, but it has been repeatedly undermined by continued Canadian violations of the agreement,” said Chuck Roady, Vice President and General Manager of Stoltze Land and Lumber Company.  “We are very thankful Congressman Rehberg understands that, in order to keep companies like ours employing Montanans, there is a need to extend the agreement for an additional two years as well as making sure the terms are enforced.”

Rehberg’s letter is backed by the Montana Wood Products Association and the Montana Logging Association, along with several Montana timber companies, such as Plum Creek, FH Stoltze Lumber, RY Timber, and Stimson Lumber.

Dear Ambassador Kirk,

We are writing to express our conditional support for extending the U.S.-Canada Softwood Lumber Agreement (SLA).  Our condition is premised on the simple principle that there exists a direct linkage between trade agreement enforcement and saving U.S. jobs – and as such, strong, timely, and effective enforcement of our trade agreements is essential.  We commend you for the trade enforcement steps that you have taken under the SLA, but urge you to ensure that any future violations by Canada are addressed expeditiously.  Our forestry industry and their workers and communities deserve nothing less.

The current arbitration case against British Columbia (BC) timber pricing violations is of utmost importance to the future of the U.S. lumber manufacturing industry.  The trade agreement violations are so blatant that questions have been raised even within Canada about the BC government stumpage practices.  It is unfortunate that Canada was able to forestall the initiation of the SLA dispute resolution process for over two years – a time during which U.S industry and workers suffered significant harm as a result of BC’s timber pricing SLA violation.

We believe that the Softwood Lumber Agreement, on balance, has been beneficial to lumber producers, timberland owners, and employees across the Unites States.  The detrimental effects of Canada’s violations of certain key terms of the Agreement, however, have been particularly injurious because they occurred in ruinous lumber market conditions -- the very conditions for which the Agreement was designed to be the most effective at providing an offset to Canada’s unfair lumber trade practices.

As the economic recovery remains tepid, the lumber market outlook is bleak.  History tells us that Canada will continue to push the envelope on circumventing the Agreement, and the need for full and effective U.S. enforcement will continue to be absolutely critical. 

Our support for extending the Agreement for an additional two years hinges on your iron clad commitment that any Canadian violations will be addressed in a timely and effective manner.  If Canada circumvents the Agreement terms, the United States must aggressively enforce its rights under the Agreement so that the domestic industry is not further harmed by any delays while its Canadian counterpart continues to reap the benefits of unfair government subsidies – Canadian delaying tactics must be denied.  Timely and strong responses to any Canadian violations are essential to U.S. companies, workers, and other sectors which depend on a healthy forestry industry.

We look forward to continue working closely with your office to ensure that this agreement is administered and enforced effectively by the United States to establish fair competitive conditions for American sawmills, mill workers and family timberland owners.

Sincerely,