Tuesday, December 04, 2007

How's That Softwood Lumber Agreement Going Anyway?


Big troubles in the Canuckistanian forest industry:

VANCOUVER - Canfor Corp. (TSX:CFP) announced another round of job cuts Wednesday as Canada's biggest lumber producer looked to cut costs as poor lumber markets and the high Canadian dollar continue to take their toll on the forestry giant.


On Tuesday, Ainsworth Lumber Co. Ltd. (TSX:ANS) said it will shutter its jointly owned Footner Forest Products Ltd. oriented strand board mill at High Level, Alta. just before Christmas.

So, what's the problem?

Well, of course it's the high dollar and the slumping US homebuilding market which is driving down prices:

But here's the thing - and its a thing we made a considerable fuss about back when Stephen Harper and his floor-crossing lackey David Emerson forced the softwood anschluss agreement down our throats a year-and-a-half ago - which is that SLA becomes egregious to Canadian producers as prices fall:

Salman Partners analyst Paul Quinn lumber producers are seeing some of the lowest prices in recent memory.

"And then if you're a Canadian producer you've got a Canadian dollar that's at all-time highs so you have that translation loss and then you signed a softwood lumber agreement which in a down market like right now sees you paying a 15 per cent export tax," Quinn said.

And don't forget this 'peace in our time' Neville Chamberlainish white paper/flag agreement also cost us a billion dollars and that it was signed at a time when we were winning tribunal judgements hand-over-fist.

I guess that's just one more 'Gnu' example of the Weather Office-assisted propagammon known as the gramatically-challenged 'Strong Leadership. A Better Canada'.



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