Wednesday, January 19, 2011

U.S. taking Canada to arbitration over softwood

It seems the efforts to use the beetle-killed wood before it rots are displeasing to the Americans:

The beetle infestation that has ravaged the dense forests of the B.C. Interior could wind up costing Canada a good deal more – up to a half-billion dollars in penalties to the United States.

The Obama administration opened an aggressive new legal front in the enduring trade fight over lucrative softwood lumber exports, accusing Canada of violating a 2006 deal by allowing British Columbia to sell vast quantities of cut-rate, Crown-owned timber to lumber companies.

From the Globe. And what is the nature of this "subsidy"?
The heart of the U.S. case is that B.C. lumber producers have blatantly exploited the beetle infestation and a flawed timber pricing system to get their hands on vast quantities of good, cheap logs during the worst industry slump since the Great Depression. Lumber that typically would be sold to mills for as much as $18 per cubic metre was instead dumped for only 25 cents per cubic metre. The result lowered lumber prices across North America and inflicted pain for U.S. mills, according to the U.S. claim.
Right. So presumably we're supposed to let the stuff rot (and incidentally dump vast amounts of CO2 into the atmosphere), so that it will be cost-effective for the Yanks to cut down live trees. Does this make any sense?

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