Canada Preparing to Propose Lumber Agreement with Provincial Options

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June 21, 2016 – Canadian negotiators are expected to float a proposal for a bilateral trade agreement with the U.S. regarding softwood lumber. The text seeks to retain certain key language from the expired 2006 agreement, such as provisions allowing its provinces to choose to apply either “hard” or “soft” quota options to its exports.

The so-called “hard” quota option consists of a volume cap, coupled with a lower export tax. The “soft” quota is comprised of a variable export tax, dependent upon lumber prices, which serves in a similar capacity as a fixed quota.

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