Cedar and redwood push on amid Cfliiadian softwood duty

rFHE Canadian sofrwood duty is |. impacting the specialty softwood market, providing a slight boosr to domestically grown redwood and a small impediment to Canadian-raised western red cedar.

"Despite the impact of the countervailing duty that has been levied on softwood lumber, the demand for tcedar remains strcng, but tariffs and duties pose danger," admits Doug Clitheroe, general manager-marketing and sales for International Forest Products and chairman of the Western Red Cedar Lumber Association.

"The price increase is being driven solely by the countervail lumber duty and is being absorbed by the markerplace," says Clitheroe. "However, the duty has widened the price gap between cedar and competing nonwood products, and there is concern that the price of cedar may reach a point at which consumers will begin to consider using alternative products. Over the longer term, the move to higher prices can cost us market share unless the industry tells the consumer why they are required to pay a premium for cedar products." duties and in-roads being made by composites."

,',,WRCLA is working with the provincial government on a matching funds program to promote cedar. Clitheroe says, "Our objective is to launch a promotional program next year, aimed at supporting cedar's position in key North American markets."

Sprenger expects sales to stay strong through the building season and into the fall, and revenue to be ahead of last year's. "We are expanding our yard capacity, putting up a storage facility of about 20,000 sq. ft. that will be completed this fall," he notes.

"Business has been very good, the Northeast market has been holding up quite well, but what will happen in the last quarter of this year if the price of cedar increases?" wonders Bernie Bernstein, Mid-State Lumber Corp., Branchburg, N.J. "Most of our products are in the high grades which means cedar is at the top end of the market. We don't know whether the consumer will accept that. Right now we are marketing the inventory we bought over the last couple of months when a window of opportunity presen&d itself."

"Cedar prices did not reflect the full impact of the countervail duty in the spring because much of the cost of cedar in the inventory was absorbed by the marketplace." says Chris Lynch, Reid & Wright, Broomfield, Co. "Most of the projects underway had been planned well in advance, so they went ahead even though the cost of cedar had increased. But we are very concerned prices for cedar will the product once line has been used. on us, ume between closing easlgr to educates retail lumber dealers, especially those who work at the counter.

He says, "Our business is strong and better than it was last year. We haven't seen any speed bumps yet."

Redwood, conversely, stands to gain from the tariffs. "The purpose of the countervailing duty is to provide a level playing field for domestic lumber products and those imported from other countries,o' says Chris Grover, California Redwood Association, who argues that subsidies give Canadian producers an unfair advantage in supplying U.S. markets. "This is particularly true when comparing Canadian cedar to California redwood."

He explains that redwood grows almost entirely in California, with just a few groves over the Oregon border. "Nearly all redwood lumber comes from privately owned timberlands," Grover adds. "None comes from U.S. National Forests. As a California product, redwood is grown and harvested under some of the most protective environmental safeguards in the world, which adds considerably to the cost of bringing products to market. When imported lumber products are given subsidies by their governments, it undermines the effectiveness of domestic environmental protections and hurts U.S. businesses."

Grover concludes: "The U.S. has a strong appetite for softwood lumber, including specialty products such as redwood and cedar. These products are useful, beautiful and unlike manv non-wood substitutes, they are a renewable resource. Redwood lumber is being grown and harvested in a sustainable manner. It is probably too early to judge any effect from the countervailing duty, but lumber producers report that today's redwood is and available. It can comwith cedar and any other product