Canadian envoy fires back against 'inflated rhetoric' on softwood lumber in US

Canada's ambassador to the United States is firing back at a group of American senators who signed a public letter containing what he calls "inflated rhetoric" about Canadian softwood lumber.

Earlier this week, 25 senators sent a letter to U.S. Trade Representative Michael Froman that alleged Canadian lumber is subsidized, unfairly traded and has had decades worth of well-documented adverse economic impacts in the U.S.

Ambassador David MacNaughton shot back Wednesday in a missive of his own to U.S. Sen. Ron Wyden, saying the Americans' letter contained concerning "mischaracterizations."

This week's exchange comes as the two countries try to negotiate a new deal to calm a recurring trade dispute over whether Canadian lumber producers are unfairly subsidized through cheap access to public land.

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MacNaughton wrote that Canada is committed to working with the U.S. to find a "durable solution" that makes the share of Canadian imports in the American market more predictable. But he added that any deal must be flexible enough to reflect the commercial realities of the sector in regions across Canada.

"A successful negotiation is not guaranteed," MacNaughton wrote in the letter, obtained by The Canadian Press.

"It is clear to me that inflated rhetoric can only complicate efforts to reach a solution. It is for this reason that I am disappointed with some of the inaccurate language that is contained in your letter to Ambassador Froman."

He added that despite repeated investigations and litigation over the past 35 years, there have never been findings of a countervailing subsidy or of an adverse impact that has survived legal challenge.

Obama, Trudeauoptimistic deal can be reached

Talks are underway toward striking a new softwood lumber deal between the two countries, with Prime Minister Justin Trudeau himself discussing the issue with U.S. President Barack Obama. The leaders have expressed optimism that a compromise could soon stave off fresh battles in the softwood lumber war.

The U.S. senators wrote Tuesday in their letter to Froman that an eventual solution from softwood negotiations would only be acceptable if it addresses Canadian timber policies and if it's sustainable over the long term. The letter called the now-expired 2006 trade agreement an ineffective framework for managing subsidized Canadian trade in an evolving market.

"Subsidized and unfairly traded lumber imports continue to severely harm United States mills, workers and communities," reads the letter, signed by prominent senators including Marco Rubio.