Sept. 7 (Bloomberg) -- The Bloc Quebecois, Canada's second- largest opposition party, plans to back an accord to end a four- year dispute with the U.S. over softwood lumber tariffs because Quebec companies support it.

``We must represent Quebec's interests, and this is why we're announcing we will support the bill,'' party leader Gilles Duceppe said in Montreal today. The Bloc consulted with lumber companies, unions and towns and was told the industry had to accept the agreement as the situation is ``desperate,'' he said.

The Bloc's support guarantees that legislation on the accord will pass, allowing Canadian companies including Canfor Corp. to collect $4.3 billion in returned duties from their U.S. counterparts. The Conservative government has a minority of seats in Parliament, so an election could be triggered if opposition parties reject the bill.

Prime Minister Stephen Harper said last month that he'll introduce the law in the parliamentary session that starts Sept. 18. The Liberals, Canada's largest opposition party, have said the terms of the deal allow the U.S. to quit it too easily. They also have criticized it for forcing Canadian companies to drop lawsuits against the U.S. government.

About 85 percent of Canadian exports are shipped to the U.S., including $7.4 billion worth of softwood lumber last year, according to Statistics Canada. Quebec accounted for 18 percent of Canadian softwood lumber exports to the U.S. last year, according to the agency.

Lumber Losses

Quebec lumber producers including Domtar Inc. and Abitibi- Consolidated Inc. have posted quarterly losses in the past year as prices declined and the Canadian dollar rose against its U.S. counterpart, making their goods more expensive in that country.

Lumber imports to the U.S. have slowed alongside home construction, leading futures to drop 19 percent since Canada and the U.S. first announced a tentative agreement on April 27.

The U.S. imposed duties starting in 2002, saying Canada and its provinces unfairly subsidized the country's lumber exports. The duties followed a five-year truce in the dispute, which began in 1982, when the U.S. lumber industry first called on the government to impose them.

To contact the reporter on this story: Alexandre Deslongchamps in Ottawa at adeslongcham@bloomberg.net

Last Updated: September 7, 2006 12:12 EDT