Maine governor says Trump lumber tariffs threatening jobs

By MARINA VILLENEUVE Markets Associated Press

Gov. Paul LePage has asked President Donald Trump's administration to exempt eastern Canadian provinces from softwood lumber tariffs that he says will lead to layoffs and shut-down operations in Maine.

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The Republican president has argued Canada unfairly subsidizes its softwood lumber industry, which includes spruce, pine and fir used for everything from home construction to newspapers. The Trump administration this year began collecting preliminary tariffs on imported softwood lumber from Canada.

A 19.88 percent tariff expired Saturday, though most lumber companies still pay a 6.87 percent duty. U.S. commerce and trade officials are investigating the industry and its impact on American producers. U.S. officials have until November to decide whether to reinstate the tariffs.

LePage, a Republican, asked U.S. Commerce Secretary Wilbur Ross this month to exempt Canadian provinces New Brunswick and Quebec from the softwood lumber tariffs. The governor raised the issue with Canadian officials and fellow New England governors at a conference in Canada this week.

The matter could be hashed out soon, at a time when United States and Canadian officials are reviewing the North American Free Trade Agreement. The 23-year-old pact did away with most barriers, including tariffs, on trade between the U.S., Canada and Mexico.

LePage said the pressure for the duties is coming from the U.S. lumber coalition. He warned if new, hefty duties remain in place, there will be collateral damage to economies on both sides of the border.

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In an Aug. 3 letter to Ross, LePage said one company is moving production of shingles from Maine to British Columbia, Canada, while a Maine picket fence mill could move to New Brunswick. He also expressed concern about the impact of the "high price of pulpwood" on paper company Twin Rivers, which owns a pulp mill in Canada and a paper mill in Maine.

"The tariffs complicate our lumber trade because the closest manufacturing infrastructure may be across the border in another country," wrote LePage, who speaks French and worked in the forest products industry in Maine and Canada for years. "Without the exemption, we expect other companies will soon curtail or cease their operations and lay off Maine workers."

Only companies that prove the Canadian government doesn't subsidize their labor, electricity or fiber should receive exemptions, said Dana Doran, executive director of Professional Logging Contractors of Maine.

"We lost sawmill capacity primarily due to the advantages that Canadians have over U.S. manufacturing," Doran said.