Evidence of meeting #12 for International Trade in the 43rd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was cusma.

A video is available from Parliament.

On the agenda

MPs speaking

Also speaking

Eddy Peréz  International Policy Analyst, Climate Action Network Canada
Kevin Jacobi  Executive Director, CanadaBW Logistics Inc.
Jim Tully  Executive Vice-President, DECAST
Brian P. McGuire  President and Chief Executive Officer, Associated Equipment Distributors
Greg Johnston  President, Songwriters Association of Canada
Angella MacEwen  Senior Economist, National Services, Canadian Union of Public Employees
Garry Neil  Cultural Policy Consultant, Neil Craig Associates
Bob Fay  Director, Global Economy Research and Policy, Centre for International Governance Innovation
Ken Kalesnikoff  Chief Executive Officer, Kalesnikoff Lumber Co. Ltd.
Linda Hasenfratz  Chief Executive Officer, Linamar Corporation
Andy Rielly  President and Owner, Rielly Lumber Inc.
Kevin Young  Chief Executive Officer, Woodtone Industries
Mike Beck  Operations Manager, Capacity Forest Management
William Waugh  President, WWW Timber Products Ltd.
Patrick Leblond  As an Individual
Francis Schiller  Advisor, Woodtone Industries

8:05 p.m.

Liberal

The Chair Liberal Judy Sgro

Thank you very much, sir.

We go on to Mr. Hoback.

8:05 p.m.

Conservative

Randy Hoback Conservative Prince Albert, SK

Thank you, Chair.

Chair, before I get started, I just want to thank all of the staff, the support people who have been here these last two weeks, putting all of this together and making sure that we have everything.

8:05 p.m.

Some hon. members

Hear, hear!

8:05 p.m.

Conservative

Randy Hoback Conservative Prince Albert, SK

We've always signalled that we're going to vote in favour of this agreement, but we've had lots of concerns about it. One concern was, of course, softwood lumber. The fact that there was a softwood lumber package put together a few years back and that we then found out that a lot of that money didn't flow was concerning. The fact is it's too late now for it to flow.

I looked at softwood lumber. In talking to some of the people right across Canada in the sector—I didn't talk to any of you, which is unfortunate, but I will now—I heard that once this is passed, there is a softwood lumber agreement sitting in the background. Have you heard the same thing?

8:05 p.m.

Chief Executive Officer, Woodtone Industries

Kevin Young

I'm optimistic that there is, but I'm not confident there is. I think that's also dictated by what's going on in the U.S. political system right now. As much as I would like to think there is something in the background that's being discussed, everyone I've spoken to has not indicated there is.

8:05 p.m.

Conservative

Randy Hoback Conservative Prince Albert, SK

The minister's been putting on a lot of pressure to get this passed, and the premiers have been putting on a lot of pressure. One tool they're using is saying there's softwood lumber sitting in behind this, so get this done and then softwood lumber will be dealt with right away. I guess I'm just trying to figure out what's real and what's not. I'm hoping they're right.

Having said that, if there isn't a deal, how do we mitigate what's going on right now? What do we need to do?

We want to get a deal. Don't get me wrong. That would be my priority one: Get a deal, solve the tariff issue and go back to business as usual and give some stability. In light of that, what do we do?

8:05 p.m.

Chief Executive Officer, Woodtone Industries

Kevin Young

Well, for Woodtone and companies that are similar to us, I think generally the approach, historically, has been that everybody's in or everybody's out. We've been approaching it from the largest side of the triangle. I think there's an opportunity here.

We're at a unique inflection point here in terms of having a vehicle in order to accommodate a fairly small sector of the softwood business. There's a lot of softwood business, there are a lot of softwood products that are outside of the scope. We manufacture some ourselves that are outside of the scope. I think that if we can approach it with some urgency—in our particular case I said this amendment affects a number of companies across Canada—it can provide some certainty.

The uncertainty in our business, as everyone here has spoken to, is significant. In our case an amendment could assist in providing some certainty for a number of companies.

8:05 p.m.

Conservative

Randy Hoback Conservative Prince Albert, SK

Is there a short-term replacement for the U.S. market?

8:05 p.m.

Chief Executive Officer, Woodtone Industries

8:05 p.m.

Conservative

Randy Hoback Conservative Prince Albert, SK

Is there a long-term replacement, with some of the new trade deals such as CETA, the TPP and that?

8:05 p.m.

Chief Executive Officer, Woodtone Industries

Kevin Young

No, not in our case.

8:05 p.m.

Conservative

Randy Hoback Conservative Prince Albert, SK

Ken.

8:05 p.m.

Chief Executive Officer, Kalesnikoff Lumber Co. Ltd.

Ken Kalesnikoff

Yes, I can comment on that. One thing I am very much afraid of is this new deal. The federal government and the provincial government have both told us to diversify away from the U.S. market, so we have, but now we have no shipments of record importing. If there's a deal made and the U.S. coalition really wants a quota deal, we're screwed.

8:05 p.m.

Conservative

Randy Hoback Conservative Prince Albert, SK

You don't have any—

8:05 p.m.

Chief Executive Officer, Kalesnikoff Lumber Co. Ltd.

Ken Kalesnikoff

No, because we were told to diversify, which we did.

You're asking about a deal. I'm very puzzled that it would be out there, and I'm not an expert. What happens to us, all of us, including Andy, is that we are kept in the dark most of the time.

These deals are made, and when Andy refers to big companies, we're talking about Canfor, West Fraser, Interfor, and Resolute. Those are the companies that are being called and talked to. They very seldom talk to us, which is why I'm here. I'm going to be stranded in Ottawa because I wanted to come to have this opportunity to say that to you.

8:05 p.m.

An hon. member

It's a lovely place.

8:05 p.m.

Chief Executive Officer, Kalesnikoff Lumber Co. Ltd.

Ken Kalesnikoff

I don't disagree. Apparently we can't go skating because it's slushy, but I don't know how that could happen when it's so cold.

Anyway, at the end of the day, somebody needs to start to listen to the small operators across this country. That is not happening, and that is very frustrating when we are the ones who are staying in our communities and are the ones employing people. We're not shutting down, but investing.

Our families' sales are $68 million a year. We're investing $35 million. Do you know how we did that? We put our homes on the line, my home and both of our kids' homes. Nobody here knows that, but the policies are being made here, and the people who get to come here are the ones who have big shareholders. We don't. We have ourselves, and if we don't make it, Mama is going to be unhappy.

Getting to your question, Randy—I'm sorry, I get passionate—at the end of the day, I have not heard of anything going on. There may be. I'm not walking the halls here, but when I look at it logically, why would there be? The U.S. holds all the cards. The coalition is super strong. They're sitting just waiting. They're just giggling at all this right now.

When there's enough money in the piggy bank and we start talking about sharing that piggy bank, then maybe they'll come to the table, and if they lose a couple more.... This last NAFTA challenge that came out, where their duties are going to be reduced potentially.... Without that, what would we have? It would continue.

I apologize.

8:10 p.m.

Liberal

The Chair Liberal Judy Sgro

Please don't—

8:10 p.m.

Francis Schiller Advisor, Woodtone Industries

If I may just jump in quickly—

8:10 p.m.

Liberal

The Chair Liberal Judy Sgro

Yes, go ahead.

8:10 p.m.

Advisor, Woodtone Industries

Francis Schiller

Just to complement some of the comments you've heard here, I think it's important for committee members to recognize that they have the power right now to make a difference. It's not about a pot of gold at the end of another rainbow. Before you, right now, is the capacity to make the softwood lumber dispute better for a set of producers, and that's within your purview, within your power.

Part of Mr. Young's message is that you guys can move with confidence based on past precedent and supported by sound public policy. In the public interest you can make a very surgical amendment that will get more attention in Washington than anything our negotiators can do right now, by leveraging what you have before you to make it better for, not the large primary producers that you have heard have benefited from high prices and sustained demand, but the small and medium-sized enterprises that are investing, employing and extracting maximum value on this side of the border.

That's why they are here today. It's to say that you guys can make a difference right now with a very small amendment that will not compromise the NAFTA deal or the USMCA. Rather, it's about how it's going to be implemented, and there are provisions. You can make a small change that will make it better moving forward for a group of producers in this country.

Thank you.

8:10 p.m.

Liberal

The Chair Liberal Judy Sgro

Thank you very much.

We will go on to Mr. Sarai.

8:10 p.m.

Liberal

Randeep Sarai Liberal Surrey Centre, BC

Thank you.

I'll be sharing my time with Ms. Bendayan.

First I want to thank all of the British Columbia sawmills who are here and elsewhere. I want to let you know that we do take this very seriously. All the mills that are in my riding—I've the most softwood employees per capita in all of British Columbia, I've been told by COFI—are all like you, Mr. Kalesnikoff. They're all independent, they've all put their homes on the line, and as a member of Parliament, I try to meet with them regularly to find out their difficulties.

Do you have a say in COFI? You're not a member?

8:15 p.m.

Chief Executive Officer, Kalesnikoff Lumber Co. Ltd.

8:15 p.m.

Liberal

Randeep Sarai Liberal Surrey Centre, BC

We listen to everyone on every study—whether you're an independent producer like you, or you're small producer with 10 employees, or with 200 or 2,000, or as Linamar is, with $7 billion in sales and 7,000 employees.

When it comes to softwood lumber, we have been fighting. If you recall, the Prime Minister brought this up at his first meeting with President Obama, and the President didn't even know there was a dispute. That's how small it is to them, but how big it is to us. I've been told that this has been talked about at every subsequent meeting between President Trump and our Prime Minister, but you know the politics of how these countervailing duties are put in place. They grind you and they hold you to it.

I think the best that Canada can do, unless you have suggestions otherwise, is to go to the places we can to challenge them. We've been successful. I have a steel fabricating company in my riding with 100 employees who fabricate American steel in Canada and then ship it back for building in the U.S. They were slapped with a 7% tariff three weeks ago. We won at the U.S. commerce board.

Unfortunately, these are the challenges we have to deal with in this kind of trade environment, but the good thing is that Canada usually is successful at the end of the day, and that's what I'm believing. That's why you've survived in the past, even though your piggy bank got pretty slim at certain times, but we hope we'll be successful again.

Mr. Schiller, how do you think we'll be able to amend something very quickly? I don't think it's plausible to put it in this. Maybe what you're asking for is that we push the Americans harder to get an agreement. That might be something, but we will not be able to use this. I don't know how that would be able to be done in a tri-party deal.