Trump Presidency brings uncertainty for forest and cattle industries

January 16, 2017

By: CFJC Today

No one will argue Donald Trump is a man of many words.

Whether he will follow through on this promises, including settling North American trade disputes, is what has people like TRU Political Science Professor Terry Kading on pins and needles. His concern, B.C’s lumber industry.

“I think we’re in a difficult position moving forward, whether it means higher tariffs, which is likely,” said Kading.

The Softwood Lumber Dispute has been an ongoing battle Canada and the U.S for more than 30 years.

“The root of the problem is they use a bidding process and up here we allocate certain forest areas to companies based on a stumpage rate,” said Kading. “They’ve always hated that system.”

Like a lot of Southern Interior forestry companies, Kading fears the Trump government will slap hefty tariffs onto exported lumber in an effort to boost American forest companies.

“I think you end up with a lot of lost opportunity for expansion in the forestry industry and for job creation because protectionism of Trump clearly benefits their companies lumber producers in the United States,” said Kading.

And then there’s BC’s cattle industry.

Under the North American Free Trade Agreement, there’s virtually no tariffs on Canadian goods imported into the U.S, including Canadian beef.

With Trump promising to renegotiate, and even withdraw from the NAFTA agreement to improve the American economy, members of the B.C Cattlemen’s Association say they’re also worried for their industry.

“The United States is our biggest trading partner and it’s our best trading partner for a lot of aspects,” said Kevin Boon, General Manager of the B.C Cattleman’s Association.

While Trump remains committed to NAFTA renegotiations once in office, B.C Cattlemen’s Association say a complete withdrawal of the deal is unlikely. They add with a low Canadian dollar, Canadian beef is good value.

“We’re a little more confident Trump’s not going to change NAFTA conditions in the fact that there’s other 30 states that deal directly and depend on Canada for trade,” said Boon. “One of the other things that is more dependant is the dollar. As we hover in that 70 to 75& mark, they have extremely good buying power here.”

Until it’s known how Trump will proceed on NAFTA and a new Softwood Lumber Agreement, industry observers say all they can do is prepare for the worst.

By: CFJC Today

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