[Congressional Record Volume 147, Number 17 (Wednesday, February 7, 2001)]
[Senate]
[Pages S1157-S1158]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




   SENATE CONCURRENT RESOLUTION 8--EXPRESSING THE SENSE OF CONGRESS 
              REGARDING SUBSIDIZED CANADIAN LUMBER EXPORTS

  Ms. SNOWE (for herself, Mr. Lott, Mrs. Lincoln, Mr. Cochran, Mr. 
Hutchinson, Mr. Thurmond, Mr. Crapo, and Mr. Craig) submitted the 
following concurrent resolution; which was referred to the Committee on 
Finance:

                             S. Con. Res. 8

       Whereas the Canadian provinces use government timber to 
     subsidize lumber production and employment by providing 
     timber to Canadian lumber companies through noncompetitive, 
     administered pricing arrangements for a fraction of the 
     timber's market value;
       Whereas unfair subsidy practices have resulted in shipments 
     of lumber to the United States to the point that subsidized 
     Canadian lumber is being imported into the United States at 
     record levels and now accounts for over one-third of the 
     United States softwood lumber market;
       Whereas highly subsidized Canadian lumber imported into the 
     United States has resulted in lost sales for United States 
     lumber companies, depressed United States lumber values, 
     jeopardized thousands of United States jobs, and contributed 
     to a collapse in lumber prices;
       Whereas Canadian lumber subsidy practices have been 
     identified by a variety of independent analyses;
       Whereas United States Government officials in the Reagan, 
     Bush, and Clinton Administrations, United States industry, 
     timberland owners, and labor unions have called for an end to 
     the subsidies and for fair trade; and
       Whereas an agreement between the United States and Canada 
     on lumber trade is scheduled to expire on March 31, 2001: 
     Now, therefore, be it
       Resolved by the Senate (the House of Representatives 
     concurring), That the President, the United States Trade 
     Representative, and the Secretary of Commerce should--
       (1) make the problem of subsidized Canadian lumber imports 
     a top trade priority to be addressed immediately;
       (2) take every possible action to end Canadian lumber 
     subsidy practices through open and competitive sales of 
     timber and logs in Canada for fair market value, or if Canada 
     will not agree to end the subsidies immediately, provide that 
     the subsidies be offset in the United States; and
       (3) if Canada does not agree to end subsidies for lumber--
       (A) enforce vigorously, promptly, and fully the trade laws 
     with respect to subsidized and dumped imports;
       (B) explore all options to stop unfairly traded imports; 
     and
       (C) limit injury to the United States industry.

  Ms. SNOWE. Mr. President, I rise today to introduce a Senate 
concurrent resolution that urges the administration to realize that an 
immediate trade priority should be to address the problem of subsidized 
Canadian softwood lumber imports. I am pleased to be joined in this 
effort by Senators Lott, Lincoln, Cochran, Hutchinson, Thurmond, Crapo, 
and Craig.
  The U.S.-Canada Softwood Lumber Agreement of 1996 will expire on 
March 31, 2001--just 53 short days from now--and there are no 
government-to-government negotiations taking place. We do not know just 
what will happen if the Agreement is allowed to expire with no 
alternative solution in place, but without restrictions, the subsidized 
lumber from Canada will flood over the border further impacting our 
U.S. sawmills. This to me is unacceptable.
  It is safe to say that we who represent our respective states here in 
the Senate share the same goals for our constituents--economic growth 
and prosperity through secure businesses and jobs, a healthy 
environment, including the ability to purchase reasonably priced homes 
and lumber with which to remodel. I cannot stand by,

[[Page S1158]]

however, and watch someone's dream become another's nightmare.
  The United States has over four million forest landowners, with 
approximately 20,000 logging facilities, sawmills and planing mills, 
which employ over 700,000 employees. In the past year, lumber prices in 
the United States have plummeted by 33 percent while Canadian imports 
have grown to record levels. Approximately 3,500 mills have already 
closed, and I have heard from those with sawmills in Maine that are 
still open that they are close to laying off their hard-working 
employees and using their lumber to board up their businesses. Their 
message, as is mine, is for free trade that is also fair trade.
  I would like to note that, the problem of the subsidized lumber is 
not coming from Maine's good neighbors to the North--those small 
sawmills of the Canadian Maritimes--as they do not have vast amounts of 
crown, or government-owned, forest, but also get their wood from 
private forests, and they do not fall under the current quotas of the 
Agreement. There are only four provinces that actually fall under the 
quota system, Quebec, Ontario, Alberta and British Columbia, and the 
large integrated sawmills--those that have both pulp and sawmill 
operations, are doing very well. On the other hand, the small sawmills 
in the Maritimes are hurting just as much as our sawmills in the United 
States. This is a trade problem that we must negotiate with Canada in 
the interests of the United States while they also work to solve their 
own inequities.
  The U.S. timber prices for lumber are set by the market for both 
public and private forests, while the Canadian Government sets the 
price of timber from Quebec to British Columbia at a level that is one 
half to one-quarter the actual market value of timber. Some of the 
Canadian provinces with vast crown forests use government timber to 
subsidize lumber production and employment by providing timber to 
Canadian lumber companies through noncompetitive, administered pricing 
arrangements for a fraction of the timber's market value.
  These unfair subsidy practices have fueled shipments to the United 
States to the point that subsidized Canadian imports are at record 
levels and now control over one-third of the U.S. softwood lumber 
market. The highly subsidized Canadian lumber imports have gained sales 
volume from U.S. lumber companies, depressed U.S. timber values, and 
jeopardized thousands of U.S. jobs, and contributed to a collapse in 
lumber prices.
  Canadian lumber subsidy practices have been identified by a variety 
of independent analyses. U.S. Government officials in the Reagan, Bush 
and Clinton administrations, the U.S. industry and timberland owners, 
and labor unions all have called for an end to the subsidies and for 
fair trade.
  We are calling upon the President, the Office of the U.S. Trade 
Representative, and the Secretary of Commerce to take every possible 
action to end Canadian lumber subsidy practices through open and 
competitive sales of timber and logs in Canada for fair market value, 
or if Canada will not agree to end the subsidies immediately, the 
subsidies must be offset pending some sort of reform.
  In addition, if Canada will not reach an agreement to vigorously, 
promptly, and fully enforce the trade laws against subsidized and 
dumped imports and explore all options to stop unfairly traded imports, 
and to limit injury to the U.S. industry pending further action, the 
administration should be prepared to vigorously and fully enforce the 
trade laws against subsidized and dumped imports from Canada.
  I hope that these efforts today will jump start the administration as 
soon as tomorrow to start working towards negotiations with Canada. 
There are no surprises here, as the issue has been around since the 
1930s. There have been years of investigations, assessments, petitions, 
rulings, imposed duties, and a 1986 Memorandum of Understanding to 
address the inequities.
  As a matter of fact, a major reason for bringing Canada to the 
negotiating table for the 1996 Agreement, along with a lawsuit by the 
Coalition for Fair Lumber Imports, was the implementing legislation for 
the GATT Uruguay Round Agreements. Congress approved the President's 
``statement of administrative action'' that stated that lumber imports 
from Canada could be subject to countervailing duties under the Uruguay 
Round.
  Every possible action must be taken immediately, to end Canadian 
lumber subsidy practices through open and competitive sales of timber 
and logs in Canada at fair market value. This trade must be both free 
and fair. I thank the Chair.

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