Forest Products: Trade Policy Highlights


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	FOREST PRODUCTS TRADE POLICY HIGHLIGHTS - JANUARY 2004
	Japan and Korea Agree to Oppose Wood Product Tariff Elimination
	According to an article in the Japan Forest Product Journal, representatives from the Japanese and Korean Ministry of Agriculture, Forestry and Fisheries met on January 9 to launch a bilateral forum on forestry. Both countries agreed to cooperate to retain tariffs on forest products in bilateral and multilateral fora. Japan and Korea agreed that they would not support New Zealand if it proposes the elimination of wood tariffs in WTO multilateral trade talks, because forest product tariffs not only protect the domestic industry interest, but, they argue, also protect the environment and preserve limited natural forest resources.

	WTO Appellate Body Reverses Part of Earlier WTO Ruling on U.S. Countervailing Duties (CVD) for Softwood Lumber
	On January 19, 2004, a WTO appellate body ruled largely in favor of the United States, confirming that Canadian Provinces are subsidizing timber sales. The WTO appellate body also reversed an earlier finding by concluding that the Department of Commerce (DOC) may use a benchmark other than private prices in Canada to determine the amount of subsidy, provided that DOC can show that Canadian private timber prices are depressed by government sales, and DOC ensures that the alternative benchmark relates to prevailing market conditions in Canada. A NAFTA panel has already confirmed that government sales depress private timber prices in Canada.

	Department of Commerce (DOC) Responds to NAFTA Panel Remand On Softwood Lumber
	On January 12, 2004, DOC filed a remand determination in response to a NAFTA Panel’s decision on its final determination in the countervailing duty (CVD) investigation of softwood lumber from Canada. DOC revised its methodology for calculation of the CVD, lowering the duty from 18.79 percent to 13.23 percent. However, pending the final results of the NAFTA panel proceeding, the CVD rate will remain at 18.79 percent with a combined average antidumping (AD) and CVD rate of 27.22 percent. A NAFTA panel decision on the DOC determination filed on remand in the related AD case has been postponed until February 12, 2004. A NAFTA panel decision on the USITC final injury determination filed on remand is due March 15, 2004.

	ITC Votes to Continue Case on Wooden Bedroom Furniture from China
	On January 9, the International Trade Commission (ITC) voted unanimously that there is a reasonable indication that a U.S. industry is materially injured or threatened with material injury by reason of imports of wooden bedroom furniture from China that is allegedly being sold in the United States at less than fair value. As a result, the Department of Commerce will continue its antidumping investigation into the case, with its preliminary antidumping determination due in early May. Imports of wooden bedroom furniture from China have increased from $169 million in 1999 to $817 million in 2002. Imports through the first 10 months of 2003 were up 47 percent over the same period last year.