OTTAWA, Aug 24 (Reuters) - Canada said on Thursday the next few weeks would be critical to determine whether it could resolve a lumber dispute with the United States and threatened again that it would start litigation if no deal were struck.
The U.S. Commerce Department this year slapped anti-dumping duties on imports of Canadian softwood lumber after U.S. producers alleged much of the wood cut in Canada was subsidized.
The two sides had hoped to settle the matter before talks to renegotiate the North American Free Trade Agreement (NAFTA)opened last week but little progress has been made.
"The coming weeks will be critical to determine whether we have a partner in the United States prepared to advance our shared interests," said a joint statement issued by Canada's ambassador to the United States and envoys from the major lumber-producing Canadian provinces.
The statement also said "provinces are prepared to proceed with litigation on all fronts if a fair solution cannot be achieved." Canada's Liberal government had already made clear it would be prepared if necessary to launch a case against the United States at the World Trade Organisation.
The U.S. Commerce Department was not immediately available for comment.
The bilateral dispute is the fifth over lumber in less than 40 years. U.S. firms have long accused Canada of unfairly subsidizing its lumber producers through low fees for timber cut on public lands, a charge Ottawa rejects. (Reporting by David Ljunggren; editing by Diane Craft)