US senators have tabled a bill which if approved would see duties on Canadian softwood lumber imports rise from 27% to 46%.
The bill would nearly double the US$1.5bn currently being paid out by Canadian lumber producers.
It is a response to what is increasingly being seen as a failure of the present 27% duties. Canadian companies have ramped up production and cut costs, flooding the US softwood market with lumber.
The bill aims to include current 18.8% countervailing duties in calculating the cost of softwood lumber production in Canada.
Although it has support from several senators, the legislation would need approval from the House of Representatives and ultimately president Bush.
Meanwhile, both US and Canadian labour unions have backed a border tax proposal, to be collected by Canada, which would replace US duties. They say the protracted trade dispute is hurting workers in both countries.
