Reply #2: Lumber disagreements delay softwood deal [View All]

Sources say the two sides are deadlocked on several key issues, including treatment of the B.C. government's market-based timber pricing reforms and Quebec and Ontario concerns over the agreement's quota provisions.

Ontario Natural Resources Minister David Ramsey said his province supports the Canadian draft proposal but "it's the American one that's nickel and diming us to death."

Critics say the deal's current language will handcuff the industry. For instance, lumber remanufacturers, who export items such as flooring and window frames, worry the rules covering exports in their sector are so restrictive most won't qualify.

Besides the border tax, the agreement would give lumber-producing regions the option of accepting an export quota plus a small tax, an arrangement that concerns Quebec and Ontario because it might hamstring producers with a hard cap on exports determined monthly.

With some 55 per cent of lumber exports coming from B.C. forests, the province has the clout to kill the agreement.

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