Yesterday Premier Christy Clark was in Ottawa for meetings with her federal counterparts. Topics of note were the ongoing opioid crisis and the softwood lumber dispute with the US of which British Columbia is their largest supplier.
Presently the two countries are without a deal as the previous softwood lumber deal expired in October and the US has indicated it will allow unfettered access for BC lumber for the next year.
But after that with a new fairly protectionist and certainly an America first Trump administration, we really can’t be sure how a new deal will shape up for this crucial industry to BC.
In her statement to reporters, Clark showed why she’s such an effective leader and public speaker, outlining why she doesn’t think President-elect Trump and his new admin will want to risk a prolonged dispute with Canada over softwood lumber.
“The thing about Donald Trump is that he talked to Americans about jobs and affordability. One of the things we also know is that if Canadian softwood doesn’t come into the United States, the price of housing goes way through the roof,”
With the US housing market finally starting to show signs of life again after the massive downturn in and around the financial crisis of 2008, Premier Clark suggests Trump won't want to slow down any of that construction especially if other parts of the economy begin to pickup and housing construction follows.
But this dispute runs deeper than the simple supply and demand economics and even geographic considerations. There are many positive factors for BC softwood lumber, but America’s largest bone of contention is with Canadian stumpage, or the cost forestry companies must pay our government as a royalty.
They believe we are unfairly subsidizing our forestry companies through our somewhat complicated ‘stumpage’ formula.
Watch as I speak with BC’s Forestry Minister, Steve Thomson about some these issues with the US and why forestry revenues are way down and some of the keys to getting those revenues up again.