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Hill confident in lumber bill
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by MARK NIELSEN Citizen staff

Prince George-Peace River MP Jay Hill said as party whip he'll be making sure Conservative MPs will be in the House of Commons to vote for new softwood legislation, but is also confident enough opposition members -- particularly those from Quebec -- will come on side to allow the legislation to pass.

"I think that the Bloc will be hard pressed not to support it in the final analysis and I would hope the Liberals will as well," he said. "And I think the NDP will do what they usually do, which is be a protest party."

The federal government will bring in legislation next month to implement the controversial softwood lumber agreement with the United States after a "clear majority" of lumber producers have shown support for the deal, Prime Minister Stephen Harper announced Tuesday.

Harper did not say what percentage of producers came out in support of the deal by Monday's deadline, and Hill said he does not know the number. But Hill added he most of the bigger employers representing most of the $5.3 billion in punitive duties the U.S. has collected want the legislation to pass.

"We already know, because they've made public statements themselves, some of the major producers that have the lions' share of the duties and tariffs tied up down there in the United States have come out in support of it," he said.

"Some more reluctantly than others, obviously, but virtually all the major producers in British Columbia have signaled their intent to agree to the the negotiated agreement."

The deal is not perfect, Hill acknowledged, but remains better than enduring further litigation and forgoing the $4 billion the U.S. has promised to return if the deal is allowed to do ahead.

"Of course it's possible (to get a better deal), but we believe this is the best we can do at this time and this is the best option by far for Canada and for the industry..." he said.

Cariboo North MLA Bob Simpson, the NDP's forestry critic, painted a dire picture for the industry if the deal goes ahead.

"I think we're going to be forced into looking at ways of putting more logs across the border and less lumber because logs aren't subject to any tariffs and shifting lumber production, particularly remanufacturing and value added, south of the border and over over time I believe more dimensional lumber will also shift south of the border," he said.

As lumber prices drop, the size of the penalties increases and Simpson predicted industry will be paying between 15 and 24 per cent in penalties for 18 months from the day the deal is ratified and raised concern the U.S. will act on a clause that allows either party to scrap the agreement after two years.

"They ride out the low-end of the market when the damage to the Canadian industry is the most punitive, the highest border tax and the lowest volume shipments, and then if the market starts to turn around and prices start to come up then they'll just walk away from the deal," he said.

Prince George-Omineca MLA John Rustad disagreed with Simpson's assessment. The Liberal said the deal is government-to-government and would require the U.S. president's assent before the agreement could be terminated.

By the time the two years is up, a new president will have been elected and Rustad doubts the issue will be a high priority for whoever is elected.

"Do we really believe that the first thing on a new president's agenda is going to be to create a trade war with Canada?" he said. "I think that is highly unlikely."

Rustad also said it will be just a matter of time before lumber prices rise back above $355 per 1,000 board feet, the threshold at which no penalties are imposed.

"With the growth in the Asian markets, particularly China and India, and what that will fuel in terms of global growth, I expect we're all going to see another period of strong growth in North America again," he said.

Brink Forest Products owner John Brink welcomed Harper's announcement, saying it will bring certainty to the industry for the next decade. He said it will also mean he can restart the remanufacturing plant he shut down more than a year ago due to a lack of raw material once the deal is signed.

"There will be a hard cap in terms of how much lumber can flow into the United States and so it is highly unlikely, it would be very shortsighted, if we started sending low-grade lumber into the United States," he said.

"So the likelihood is that most of the low-grade lumber will now stay in the region for further remanufacturing."

Brink also hopes to announce in the next two to three months some other projects that have been on hold as a result of the conflict.

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