SRC-MKV H.C.R. 98 77(R)   BILL ANALYSIS


Senate Research Center   H.C.R. 98
77R6305 NBH-DBy: Christian (Staples)
Natural Resources
5/11/2001
Engrossed


DIGEST 

Lumber is an important natural resource and a vital industry for both the
United States and Texas. The U.S. and Texas timber industries' ability to
compete in a global economy, however, is hampered by the continuing influx
of Canadian lumber, which is heavily subsidized by the provincial
governments. Canadian softwood lumber producers obtain most of their timber
supply from government-owned forests, and the provinces subsidize lumber
production by selling timber to Canadian lumber companies at noncompetitive
prices for a fraction of the timber's market value.  Artificially low
provincial timber prices, minimum harvesting restrictions, and other
practices that encourage overharvesting and overproduction have helped
Canadian imports gain a 36 percent share of the U.S. softwood lumber
market.  Highly subsidized Canadian lumber imports unfairly compete with
U.S. lumber companies, jeopardizing thousands of jobs and driving down the
market value of U.S. forestlands.  U.S. industry and labor groups, U.S. and
Canadian environmental organizations, and Native American groups have
called for an end to these subsidies in order to establish fair trade
practices.  The United States must fully enforce trade laws to offset the
subsidies and mitigate injury to the U.S. softwood lumber industry if the
Canadian subsidies are not discontinued.  The only protection for U.S.
timber growers against these unfair market conditions is the current United
States-Canada Softwood Lumber Agreement, which is scheduled to expire on
the last day of March 2001. 


PURPOSE

As proposed, H.C.R. 98 submits the following resolutions:

Provides that the 77th Legislature of the State of Texas respectfully urges
the Congress of the United States to make the problem of subsidized
Canadian lumber imports a top trade priority to be addressed immediately;
take every possible action to end Canadian lumber subsidy practices through
open and competitive sales of timber and logs in Canada for fair market
value or, if Canada will not agree to end the subsidies immediately,
provide that the subsidies be offset in the United States; encourage open
and competitive timber sales at fair market prices; and take certain
actions if Canada does not agree to end subsidies for lumber.  Provides
that the Texas secretary of state shall forward official copies of this
resolution to the president of the United States, to the speaker of the
house of representatives and the president of the senate of the United
States Congress, and to all members of the Texas delegation to the congress
with the request that this resolution be entered in the Congressional
Record as a memorial to the Congress of the United States of America.