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SMALL NORTHWEST LUMBER FIRM AGAIN FIGHTS FOR SURVIVAL AGAINST SUBSIDIZED IMPORTS

 SMALL NORTHWEST LUMBER FIRM AGAIN FIGHTS FOR SURVIVAL
 AGAINST SUBSIDIZED IMPORTS
 COEUR D'ALENE, Idaho, June 8 /PRNewswire/ -- Dick Bennett is trying to carry on a family tradition started by his father in 1941.
 In the past 50 years, Bennett Lumber Company has grown from a fruit box manufacturer into an independent timber company operating three mills in eastern Washington and Idaho. It has provided jobs and economic health to several Northwest communities.
 "Our employees are like family," said Bennett, executive vice president of the family firm. "We have a civic duty to contribute to the communities in which they live."
 Today, Dick Bennett is in a battle for the survival of Bennett Lumber and hundreds of U.S. firms like it. "Canadian lumber subsidies place the very survival of my company in jeopardy," he said.
 But it is a battle he has fought -- and won -- before.
 For 38 consecutive years, Bennett Lumber turned a profit and reinvested most of it in keeping its sawmills modern and efficient. Then, during the 1979 economic recession, Canadian governments sharply rolled back timber prices, and subsidized Canadian lumber flooded into the United States.
 "Suddenly, we were competing with Canadian mills that were getting timber at stumpage rates my company would kill for," Bennett remembered. U.S. sawmills continued to buy timber at prices determined by an open, competitive market. "There was no way we could compete."
 Subsidized Canadian lumber seized one-third of the U.S. market, forcing hundreds of U.S. sawmills to close and eliminating over 30,000 lumber workers' jobs. Meanwhile, the Canadian lumber industry and its shipments to the United States expanded.
 Dick Bennett, his 400 employees and numerous other U.S. mills fought back by demanding fair trade. Their perseverance was finally rewarded in 1986.
 The Canadian and U.S. governments adopted a Memorandum of Understanding, stating that Canada would offset a portion of its subsidy with a 15 percent export tax and would work to establish fair market timber practices.
 The impact was almost immediate. "Prior to 1980, we made a profit every year," said Bennett. "After 1980, we consistently lost money until the signing of the Memorandum of Understanding."
 Now, the battle has been joined again. With lumber markets weak and the Canadian share of the U.S. market slipping, the Canadian government last October unilaterally terminated the Memorandum of Understanding and began a massive lobbying campaign to block Commerce Department attempts to make sure fair lumber trade continues.
 A Commerce Department investigation has concluded that a 6.51 percent subsidy exists on Canadian lumber imports. The U.S. International Trade Commission will vote later this month (June) on whether a countervailing duty will be imposed.
 "It doesn't take a genius to figure out why the Canadian industry and government abandoned the agreement," noted Bennett. "They want the freedom to preserve Canadian jobs with lumber subsidies."
 Still, Bennett added that, "The presence of Canadian lumber in the U.S. doesn't upset me -- fierce price competition is the nature of the market. With a level playing field, our business will take care of itself."
 -0- 6/8/92
 /CONTACT: Dick Bennett of Bennett Lumber, 208-875-1121, or William R. Lesh for the Coalition for Fair Lumber Imports, 503-452-0403/ CO: Bennett Lumber ST: Idaho IN: PAP SU:


BN-CF -- ATFNS1 -- 7706 06/08/92 07:32 EDT
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Publication:PR Newswire
Date:Jun 8, 1992
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