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Investors, start your chainsaws.

Canadian forestry stocks have been lagging their international peers amid a trade dispute with the United States and the prospect of crippling duties on their softwood-lumber exports.

But the uncertainty is good news for anyone who recognizes trees as a valuable commodity and wants to invest alongside savvy institutional investors.

The long-simmering softwood-lumber dispute between Canada and the United States, which has nothing to do with the protectionist rhetoric flowing from the current tenant of the White House, has been heating up since the last trade agreement between the two countries expired in October, 2015.

Last month, the U.S. International Trade Commission said that there was a reasonable indication that exports from Canada were harming U.S. producers. The announcement followed complaints that Canada's exports and market share have surged amid relatively weak lumber prices.

Assuming the complaints and negotiations drag on this year, Canadian lumber exports could face initial duties as high as 40 per cent, according to one estimate.

Canadian forestry executives are shaking their heads in dismay.

"It is particularly disappointing that we find ourselves once again caught up in another dispute with our American neighbours over softwood lumber exports from Canada to the U.S.," Ted Seraphim, chief executive officer of West Fraser Timber Co. Ltd., said in a statement on Friday.

He added that he would prefer no agreement to a bad agreement.

No wonder Canadian forestry stocks have been underperforming. The S&P Global Timber and Forestry index, which consists of 25 companies based in the United States, Canada, Japan, Finland, Brazil and elsewhere, has surged more than 40 per cent over the past year. It is now within 15 per cent of its 2007 peak.

By comparison, West Fraser's share price is almost unchanged since the start of 2016, and is down more than 30 per cent since early 2015. Canfor Corp. shares have taken a similar route.

But the Canadian sector should appeal to long-term investors who can stomach some volatility.

For one thing, the stocks are cheap. West Fraser and Canfor trade at about 15-times trailing profits. That's a bargain next to the Timber and Forestry index, which has a price-to-earnings ratio of about 20.

More broadly, forestry stocks should reflect the recovering U.S. housing market. Housing starts recently topped an annualized rate of 1.2 million, up from less than 600,000 during the depths of the financial crisis. But building activity is still well below the years before the housing crash, implying room for further growth.

If you prefer to look beyond companies that operate sawmills and manufacture pulp and lumber products, you can focus on an alternative that has long enthralled many pension funds and endowments: timberlands.

In 2011, two Canadian pension funds underscored this interest. The Public Sector Pension Investment Board and British Columbia Investment Management Corp. scooped up TimberWest Forest Corp. for $1-billion, after the Canadian company fell on hard times following the collapse of the U.S. housing market.

Today, publicly traded timberland companies are hard to find, which is why – full disclosure – I bought shares in Acadian Timber Corp. in mid-January. The company owns 1.1 million acres in New Brunswick and Maine and manages another 1.3 million acres of government-owned land.

Acadian, too, is swept up by concerns over the softwood-lumber dispute: "We anticipate a highly politicized process may obscure visibility on progress towards a negotiated settlement for at least most of 2017," the company said this week.

Yet, it raised its quarterly dividend by 10 per cent, in a sign of confidence.

West Fraser also sounded hopeful, noting that the U.S. construction industry depends on Canadian lumber. "We have been preparing for this for many years, and have invested significant capital throughout our Canadian and U.S. operations to improve our competitiveness," Mr. Seraphim said on a call with analysts.

If the trade dispute is weighing on forestry stocks, a resolution is bound to be bullish.