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CANADIAN LUMBER SUBSIDIES INJURE U.S. SAWMILLS

 CANADIAN LUMBER SUBSIDIES INJURE U.S. SAWMILLS
 WASHINGTON, May 28 /PRNewswire/ -- Subsidized Canadian lumber


imports severely distort the U.S. market, threatening the future of many sawmills and the employment of thousands of U.S. workers, lumber industry officials told the U.S. International Trade Commission (ITC).
 "The forests don't change because of a political boundary, only stumpage prices change," Dick Bennett, vice president of Bennett Lumber Co., a family firm based in Idaho, told an ITC hearing here today. "Thus, the fortunes of my company have been linked with stumpage prices in British Columbia and Alberta."
 Earlier this month, the U.S. Department of Commerce ruled that a 6.51 percent subsidy exists on Canadian softwood lumber imports. The ITC is expected to make a final determination of injury by June 26 before a permanent countervailing duty is imposed.
 The Commerce Department began an investigation of subsidized Canadian lumber imports after Canada unilaterally terminated a Memorandum of Understanding that had offset a portion of the subsidy since 1986.
 "As a result of the subsidies, Canadian mills have the artificial ability to lower their prices below the point at which my company can remain profitable," said Bennett. "The Canadian industry has an unfair advantage; the only difference between our products is price."
 Bennett added: "This is not abstract speculation. Subsidized Canadian lumber has been and continues to be a major obstacle to the success of our business. Prior to 1980, we made a profit every year. After 1980, we consistently lost money until the signing of the Memorandum of Understanding."
 Bennett noted that Canadian imports in the first quarter of 1992 surged 30 percent from the year-ago period.
 Brenda Elliott, wood marketing manager for Temple-Inland Forest Products Corp., Diboll, Texas, said, "In order to compete with the Canadians we have to either lower prices or lose sales -- either way, we lose revenue."
 Elliott said the five sawmills and one plywood plant of Temple- Inland's softwood lumber division have suffered "significant losses for the past two years...in contrast to other building products where we have shown a profit. We have not been able to increase our prices to offset escalating costs."
 Bennett and Elliott testified on behalf of the Coalition for Fair Lumber Imports. The Coalition is composed of lumber companies across the United States and the major U.S. lumber manufacturing associations. Member companies include Temple-Inland, Potlatch Corp., Georgia-Pacific Corp. and International Paper Co.
 Separately, the United Brotherhood of Carpenters & Joiners of America, a major forest industry labor union, said "a major cause" of layoffs in the industry can be traced to subsidized Canadian imports.
 "The recession and weak demand permitted the Canadians, with their subsidized cost structure, to take lumber sales away from U.S. lumber producers," the union said in a submission to the ITC. "So when U.S. workers are laid off, in this case the primary cause is the displacement of U.S. lumber by Canadian lumber."
 -0- 5/28/92
 /CONTACT: Patrick Wallace of Knapp Inc., 404-688-1777, for Georgia- Pacific; Tony Bennett of Temple-Inland, 409-829-1430; James Foster of International Paper, 901-763-5985; Diane Olberg of Potlatch Corp., 415-576-8826; or Sheila Weidman of Georgia-Pacific, 404-521-4732/ CO: Coalition for Fair Lumber Imports ST: District of Columbia IN: PAP SU:


BN-BR -- AT007 -- 4841 05/28/92 14:58 EDT
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Publication:PR Newswire
Date:May 28, 1992
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