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Softwood lumber Trump threat heats up B.C. election campaign

But political donation rhetoric is a ‘complete diversion’ as American tariff action threatens B.C. industry, says expert.

British Columbia Premier Christy Clark moves a piece of lumber off a sorting line before speaking about U.S. import duties on Canadian softwood lumber, at Partap Forest Products in Maple Ridge, B.C., on Tuesday April 25, 2017.

The Canadian Press/Darryl Dyck

British Columbia Premier Christy Clark moves a piece of lumber off a sorting line before speaking about U.S. import duties on Canadian softwood lumber, at Partap Forest Products in Maple Ridge, B.C., on Tuesday April 25, 2017.

With a damaging softwood lumber dispute looming on the horizon, the campaigns of Christy Clark and John Horgan have each lobbed accusations of accepting donations from organizations that have in the past lobbied for U.S. lumber protectionism.

But the tactic is a “complete diversion” from an issue that could cause serious pain for British Columbia forestry companies and workers, said Harry Nelson, a professor with the University of British Columbia’s forestry department.

President Donald Trump, who has targeted free-trade agreements like NAFTA he believes are unfair to American businesses, announced tariffs of up to 24 per cent on Canadian lumber earlier this week.

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The issue has become a hot topic in B.C.’s election campaign, with the BC NDP charging that the BC Liberals have accepted donations from “lumber barons” (U.S.-based forestry company Weyerhaeuser, which has operations in British Columbia). The Liberals fired back that the Steelworkers, a large union with members in both U.S. and Canada, have paid the salaries of several BC NDP staffers.

In the ‘I know you are but what am I?’ dynamic that’s emerged in the hard-fought campaign, the campaigns each pointed out that Weyerhaeuser and the American wing of Steelworkers supported U.S. duties on Canadian lumber during past trade disputes over softwood lumber.

Provincial politics are a factor in the negotiations, Nelson acknowledged, but the political concerns that matter as Canada heads to the negotiating table have more to do with the differing interests between B.C.’s Coastal and Interior forestry sectors, or the large corporations that ship nothing but lumber versus smaller, value-added businesses.

“We’ve got a few larger companies have become much more important than they have in the past in terms of harvesting and manufacturing rights,” Nelson said.

While larger B.C. firms like Canfor have diversified in recent years and now hold timber and sawmills in the southern United States, smaller businesses that make value-added products like shingles, panelling, doors and windows are hoping they won’t be lost in the shuffle as Canada prepares to negotiate.

Kalesnikoff Lumber, in the Kootenays, is one of those smaller companies. Businesses like Kalesnikoff are now facing a 9.88 per cent tariff that could also be retroactively applied for three months under a clause of the softwood lumber agreement the United States has unexpectedly attempted to invoke.

While Kalesnikoff Lumber ships just 25 per cent of its products to the United States, there are other businesses that depend on the American market for nearly 100 per cent of sales.

“This is going to be devastating for some companies,” said owner Ken Kalesnikoff. He would prefer the BC Liberals win the election because of their previous track record on the softwood lumber and forestry file.

 “This is where we’re going to have these bigger questions about principles of free trade, and I do get concerned that the U.S. is very astute at knowing internal politics and playing a divide-and-conquer approach,” Nelson said. “We may be entering some very fraught negotiations not only externally but internally.”

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