×

UPDATE 1-Canada giving C$867 mln to help those hit by U.S. lumber tax

(Adds details, quotes, background)

OTTAWA, June 1 (Reuters) - Canada will give C$867 million (US$642.22 million) in aid to the softwood lumber industry after the United States imposed duties on exports and is prepared to offer more help in future, the government said on Thursday.

Most of the aid - up to C$605 million - will be in the form of loans, loan guarantees and commercial financing, it said in a statement. Reuters revealed the outlines of the aid package on Wednesday.

Washington in April imposed preliminary anti-subsidy duties averaging 20 percent on imports of Canadian softwood lumber. U.S. producers say the exports are unfairly subsidized, a charge Canada strongly denies.

"We are prepared to take further action, including additional loan guarantees, to address changing market conditions," Natural Resources Minister Jim Carr told a news conference.

In a separate statement, the Canadian government said it would continue "to forcefully press our American counterparts to rescind this unfair and unwarranted trade action."

The dispute has increased tensions between Canada and the United States ahead of talks on renegotiating the North American Free Trade Agreement. The two nations are also arguing over Canadian exports of airliners as well as the system of tariffs and duties that protect Canadian dairy farmers. ($1 = 1.3500 Canadian dollars) (Reporting by David Ljunggren; Editing by Chizu Nomiyama and Lisa Von Ahn)