Whenever there is sales of exports or imports, there is the possibility of a dispute. Both countries will have their own interpretation of what is legal and what is not because laws are different in every country. The softwood lumber dispute history & its agreement extension is what keeps the international trade of lumber between the United States and Canada going smoothly.

There has been disputes in the past but the United States – Canada Softwood Agreement of 2006 gives both parties guidelines to follow when either party is questioning whether or not something was done properly. This agreement has eased tensions during this international trading of lumber. This contract was set to expire in 2013 but the contract was extended and is now set to expire on October 12, 2015.

This two year extension was agreed upon mutually by both the United States Trade Representative, Ron Kirk and the Canadian Minister for International Trade, Ed Fast. The only change that they have made to the agreement is the expiration dates, giving it a two year extension. The trade of softwood is going smoothly and making changes could upset the shipments of these products.

Both sides of the border are facing a weak demand so this is very important to keep the trade going smoothly. It is fair for both sides of the border. With this contract, it makes it much easier to settle disputes also.

It gives them an equal drawing board to go to when a dispute is filed. There have been disputes in the past that have been difficult to settle because they did not have a clear statement of how procedures were to take place. This contract has created a fair trade environment as well as a predictable one.

There can be limitations placed on the trading of the softwood but only if the price of it goes lower than a certain amount. There is a clear understanding on what the rules of the trade are. This is very important to have for any kind of international trade that will continue for a long period of time.

The extension on this contract was put into effect long before the contract was set to expire. Ron Kirk and Ed Fast both agreed that operations were going smoothly. They want to keep it this way.

The process for arbitration of any disputes is clearly stated. This gives both parties a fair and equal decision based on the procedures that are clearly stated in the contract. This contract is going to apply only to the international trade of softwood.

One of the disputes that were filed dealt with the improper calculation of quotas. Another one dealt with programs that provided benefits to softwood producers in Canada which was not allowed in the softwood agreement.

There can be disputes with any kind of contract, but this one provides clear understanding of what is supposed to take place. The United States and Canada have been happy with the way that the contract has affected their trade in a positive way. This is why they have decided to extend it another two years.

After the two years, they can evaluate the effectiveness of it again. There are many factors that can change the effectiveness of any contract. It is a way for both parties to have a say in what is happening.

Softwood is something that is necessary for building many different types of products in both countries. When there is a shortage in either country, they will export or import it. There are many different kinds of wood that can be used for certain things but this contract only applies to the international trade of softwood lumber.