Question Period Note: Increase in countervailing and anti-dumping duties imposed by the United States on Canadian softwood lumber

Increase in countervailing and anti-dumping duties imposed by the United States on Canadian softwood lumber

• Canada Economic Development for Quebec Regions supports the development of SMEs in the forestry sector, as these businesses are the drivers of economic development in many regions.

• Canada Economic Development for Quebec Regions supports projects that generate economic growth and diversification in forest communities so that they can diversify their economies and be more resilient.

• Since November 2015, Canada Economic Development for Quebec Regions has supported 95 projects in this sector for authorized assistance of 73 million dollars, generating investment of 681 million dollars and contributing to the creation or maintenance of 1,805 jobs.

• CED supports the growth of SMEs at all stages of their development, whether it be for their start-up, or for innovation, productivity or growth projects or projects targeting the development of foreign markets, through its regular programs and its temporary initiatives. In the forestry sector, CED mainly supports wood processing businesses.

• CED pays special attention to communities experiencing slow economic growth, particularly those dependent on a single sector of the economy, such as the forestry sector.

• Global Affairs Canada, in cooperation with CED, ensures that project funding proposals from the forestry industry do not raise any issues of non-compliance with international agreements.

• The forestry sector has a presence and generates economic spinoffs in 83% of municipalities in Quebec. The sector is a major economic force for 152 municipalities, where it accounts for 10% or more of all jobs.

• Most forestry sector businesses are located in the regions of Saguenay–Lac-Saint-Jean, Chaudière-Appalaches, Abitibi-Témiscamingue and Bas-Saint-Laurent.

• Quebec’s wood industry — forestry operations, pulp and paper, and wood product manufacturing —generates a total of 56,750 direct jobs divided among 2,765 businesses throughout the province.

In 2019, wood product manufacturing (wood processing) represented:

• 30,600 jobs in 2021 (0.7% of total Quebec jobs)

• 980 businesses in 2021 (0.4% of total Quebec businesses)

• $2.2 billion in 2021(0.6% of GDP and 4.7% of Quebec’s manufacturing sector)

• $5.4 billion in exports in 2021 (5.6% of total Quebec exports)

• Softwood lumber exported by Canada consists of spruce, pine and fir, used primarily for framing in the construction industry.

Issues and opportunities for wood product manufacturing companies:

• Sawmills are unable to ramp up their production quickly, in particular because of a shortage of fibre, difficulties hiring workers and the saturation of production capacity.

• The sector must shift to secondary and tertiary wood processing, with higher value-added. These value-added products make Quebec wood products stand out in comparison with those produced elsewhere in the world and represent the future of Quebec’s wood industry.

• The growing importance given to climate change and sustainability offers a number of possibilities: demand should grow for cost-effective, low-carbon solutions in the forestry sector.

On August 4, 2022, the U.S. Department of Commerce announced its anti-dumping and countervailing duty orders on certain softwood lumber products from Canada, reducing the 17.91% rate announced in November 2021 to 8.59%. For its part, Canada Economic Development for Quebec Regions (CED) supports businesses in the forestry sector, mainly wood processing businesses, which are the drivers of economic development in a number of regions, in compliance with our trade agreements. CED also supports the communities that depend on this sector, to help them to diversify their economies and become more resilient.