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Eyeing China for softwood

As Donald Trump added softwood lumber to his anti-Canada trade rhetoric Thursday, Trade Minister Francois-Philippe Champagne was on his way to China with an entourage of industry representatives looking for an alternative to the U.S. market.

One senior government official who spoke on the condition of anonymity characterized one portion of the visit as a "trade-mission oriented trip on softwood." New Brunswick, Quebec, British Columbia and Ontario producers were all represented.

"For all sorts of reasons, we're striking while the opportunity is ripe, to showcase, to take companies with us to promote them," said the official, who wasn't authorized to publicly discuss details of the trip.

Estimates of how much of Canada's softwood lumber is shipped to the U.S. are as high as 70 per cent, but the Trudeau government has placed a priority on finding new trade markets in Asia — especially China — for a variety of goods and services.

Indeed, Canada's softwood industry makes no secret of its own search for opportunities in China.

Canada Wood, an industry trade group, said earlier this month it would "take the first steps to extend its reach to Wuhan, which is the economic engine of central China," by establishing a joint Sino-Canadian Modern Wood Construction Technology Center in the little-known Chinese city of more than 10 million.

"Canada Wood China is vying for a piece of China's $44-billion hotel industry by promoting low-density, wood-frame hotels to the Chinese hotel industry," the organization's website added.

While exploratory talks on a Canada-China free trade deal between government officials take place in Ottawa next week, the first round of a high-level economic and financial dialogue will unfold in Beijing.

Champagne will be joined by Finance Minister Bill Morneau; their Chinese counterpart will be Vice Premier Wang Yang, who is also China's point man on relations with the United States.

Softwood lumber is a long-standing irritant between Canada and the U.S. The two sides are working on a new agreement to replace the nine-year truce that expired in 2015.

The U.S. Commerce Department is expected to decide by Tuesday whether to impose duties on Canadian softwood, which American producers say is overly subsidized and unfairly floods their market.



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