b'16American Journal of Transportation ajot.com(VOLATILEcontinuedPossibly.Butthereislittle from page 15) inclinationforcompromise priceshasnthelpedCana- in Canada for a pricing model das position. alreadydeemedfairand In May, Commerce Sec- thisstumpsnegotiatorson retary Gina Raimondo report- both sides.edlysaidshewantstofind along-termsolutiontoi F AT reeF Alls in Thethelumberdispute.ButtheW ooDsiTr everberATesBidenAdministration,justA rounD TheW orlDas the Trump Administration,Thereisanoldphilo-isunwillingtomovewith- sophicalquery,Ifatree outCanadaaddressingthefalls in the woods and no one stumpage issue. hears it, is it real? Philoso-phy aside, in the real world ofeconomics,whenatree falls,theentireinterwoven gigantic global eco-system of forestproductsuppliersand consumersknowsaboutit. Forexample,asDescartes-DatamynedataonU.S. lumberimportsandexports indicates (see charts) the US dwarfs other top countries as Commerce Secretaryprimarydestinationcountry Gina Raimondo forCanadianexportsand Infact,theU.S.Courtthe Top countries of destina-of International Trade (CIT)tion for US lumber are China eliminated a rule that allowed(1) and Canada (2). foreigncompaniessuchasFor that reason, the recent Canadianlumberproducerscrash in lumber prices isnt just to have individual tariff ratesabouttheU.S.andCanada: lowered. Itisthedominoeffectthat Theruleallowedfor- one region or event like the eignproducerstoquicklyCOVID-19 pandemic has oninthewood,theChineseIndia, South Korea or Taiwanforce in January of 2022a2021 - MAY 2021 - JUN 2021 - JUL2021 - JAN 2021 - FEB 2021 - MAR 2021 - APRapply for lower countervail- another. refused to lift the restrictionsbut none of the alternatives arebanreaffirmedlastMay Country of OriginGeneral Total Value FOB (USD)ing duty rates if they werentTakeAustralia.Austra-essentially banning lumberlikely to fully replace the vol- whichcoulddramatically2,393,813,620.00 2,417,500,154.00 1,631,378,592.00individuallyinvestigatedbylianlumberexportsarentexports, similar to blocks on1,405,749,841.00 1,371,863,364.00 shift purchasing for its largest CANADA umes China imported.1,829,863,788.00 1,978,559,756.00the DOC in its original dutyon the scale of the big sup- othercommoditieslikelob- Conversely,Chinahascustomer, China.211,862,042.00 225,656,212.00 242,318,036.00 244,509,440.00CHINA 223,928,854.00 200,542,972.00 242,465,886.00inquiry. With the August 18 th plierslikeCanada,Sweden,ster,beef,andcotton.Withhad no problem replacing theWillChinamakemore208,373,715.00 215,763,649.00 236,401,074.00BRAZIL 120,258,698.00 106,534,459.00 159,306,527.00 150,511,753.00CITruling,someCanadianRussia,theU.S.,Finlandorthe recent announcement bybanned Australian import vol- upstream purchases from Rus- 111,289,099.00 136,481,878.00 95,311,374.00GERMANY 73,625,505.00 66,235,614.00 113,829,706.00 110,167,947.00lumbercompaniescouldGermany (sawn wood) but upAustraliasPrimeMinisterumestheglobalforestprod- sian lumber producers (it hap- 79,094,678.00 85,114,976.00 95,683,072.00 97,542,712.00CHILE 70,907,621.00 71,010,909.00 80,370,239.00have higher duties reinstated,untilrecentlyheldanimpor- ScottMorrisonsgovern- uctmarketplace.Therewerepenedbeforewithsimilar althoughitwillapplyonlytant place as a niche supplier toment to acquire U.S. nuclearplentyofsourcingnationsexport ban on birch that pushed77,081,401.00 75,447,662.00 84,831,355.00VIETNAM 59,805,470.00 51,372,963.00 61,074,437.00 58,629,184.00prospectively [with consid- Chinawith the PRC account- poweredsubmarinesaspartevenincludingtheU.S.andbuyersfromlogpurchasesto70,082,173.00 67,467,489.00 70,455,415.00INDONESIA 52,058,681.00 69,986,892.00 64,867,586.00 60,612,188.00eration for the future]. ing for nearly 90% of the coun- of Australia-U.S.-UKtripar- Canadaready to fill the gap.product purchases) or look to60,341,415.00 66,947,612.00 66,521,623.00MEXICO 49,515,150.00 51,006,758.00 60,667,289.00 60,564,182.00There has been some indi- trys log exports (largely usedtitealliance,whichangeredAndneighboringNewZea- other suppliers, such as Canada36,668,303.00 72,596,391.00 23,261,376.00SWEDEN 32,517,997.00 9,934,881.00 43,550,540.00 62,378,310.00cationshowever slightoffor pulp) worth $1.23 billion.Chinas President Xi Jinping,land, in the absence of Austra- or New Zealand to make up the movement in the four decadeInDecemberof2020,Australianlumberexportslia is setting records with theirdifference?Eitherway,there27,172,403.00 37,056,062.00 36,692,061.00RUSSIA 22,452,813.00 15,385,280.00 19,402,510.00 24,010,968.00old logjam. Nearly a year ago,Chinaabruptlystoppedlogarelikelytocontinuetobesales to China. 2,218,942,241.00 willbeanimpactonglobal3,644,981,258.00 3,781,681,165.00 3,035,206,968.00Total 2,349,559,692.00 2,945,311,421.00 3,084,971,153.00the DOC imposed countervail- shipmentsfromNewSouthinvestedbylivepestsforBut as Australias imbro- lumber suppliers. ing duties of around 9% on cer- WalesandWesternAus- the foreseeable future.gliowithChinaillustrates, tain Canadian lumber exporters,traliaafterreportedlyfind- So, where does Australiathegloballumbermarket- T iMber T hec ollAPsedown from just over 20%. Buting live forest pests in thego now and conversely whereplace is running topsy-turvyAnDP ossibler ebounD inlittlethathashappenedsinceimported wood. While theredoes China look to replace thewithlittleindicationthatitl uMberP ricespoints to a quick (or otherwise)isconsiderabledisbeliefonDown Under volume?will settle soon. For example,Rootsofapriceclimb. resolution of the longstandingthe AustraliansidethatanyAustraliaislookingtoRussia has a pending export(VOLATILEcontinued on dispute.TheBidenAdminis- livepestswereactuallyexport to other destinations likeban on logs due to come intopage 17)trationhasholisticdesireto improverelationswithlong-termallies,suchasCanada. TheTrudeauadministration would also like to see relations with its powerful neighbor to thesouthimproveafterget-ting the cold shoulder from the Trump administration.But with forces on both sides dug in, finding common ground is difficult. From the Canadian perspective refund-ing the $3.9 billion in duties isimportant.Afterall,the WTOpanelfoundintheir favor. And way back in 2006 the George W. Bush adminis-tration did refund $4.4 billion of$5.4billionincollected countervailingdutiesonthe verysameissue.However, findingawaytodetermine whatisafaircommercial price for lumber sold to the U.S.harvestedfrompublic landinCanada,isastick-ing point from the U.S. per-spective. Can the pricing for softwoodlumberharvested on public lands be indexed?'