BURST
At the same time Ottawa commissioned a task force to delve into a transformational plan for Canada’s forest industry, B.C.’s exports continued to plummet.
The task-force co-chair Ken Kalesnikoff believes the sector has a bright future, but trade figures emphasize the urgency the industry requires — starting with easing access to timber.
“It’s a really tough place to be doing business, Canada is right now,” Kalesnikoff said. “And we’ve got to really correct that. People aren’t going to invest in an industry that doesn’t have a secure, cost competitive fibre supply.”
Pushing provinces to reform regulations and transition to land-area based licensing were top of the task force’s recommendations released Wednesday by Natural Resources Minister Tim Hodgson at a meeting of provincial forest ministers in Langford on Vancouver Island.
In January Hodgson struck the task force, led by Kalesnikoff and Quebec industry veteran Frederic Verreault, to look for advice on how to modernize the industry rather than extend another rescue plan, although the minister extended an additional $400 million in support for forest-dependent communities.
In the short term, B.C.’s lumber trade figures paint a bleak picture. The value of the province’s lumber exports between January and March dropped by 40 per cent to just $742 million compared with $1.2 billion for the same period a year ago. By volume, shipments were down 21 per cent over the same period.
“So, as far as things go right now, short term, (there’s) pain, and I’m really concerned,” Kalesnikoff said.
Over the past year leaders in B.C.’s forest industry have pushed Forest Minister Ravi Parmar to move faster on promised reforms. In April, the Council of Forest Industry warned that the industry faces another round of mill closures.
On Friday, Kalesnikoff gave Parmar’s ministry credit for moving in the right direction, “trying to get us there.”
“But it’s not easy and inside government you have different opinions on what we should be doing and not doing,” he added.
One thing that struck Kalesnikoff is how provinces each have their own problems that need to be resolved.
New Brunswick, Kalesnikoff said, stood out as a shining example of how to address the needs for conservation and forest biodiversity while also engaging intensive management to produce twice the amount of timber per hectare available for harvest compared to what B.C. produces.
“They just seem to have their act a little more together,” Kalesnikoff said.
However, he added the compromises needed to make Canada’s timber more competitive “is all doable.”
“We’re truly trying to do the right thing and we have some fantastic foresters out there and forestry people that are really trying to accommodate (conservation),” Kalesnikoff said.
In the longer term, Kalesnikoff said the task force broke down its recommendations into measures to continue stabilizing the industry to 2030, then transform the industry by 2050.
Kalesnikoff said the task force didn’t discount the need for Canada to resolve its lumber trade war with the U.S., which at the moment sees 45-per-cent duties slapped on exports south of the border.
However, the push to promote the use of wood in construction is a measure that is in Canada’s control, which holds potential.
In the federal government’s Build Canada Homes program, “they’re talking about building hundreds of thousands more homes,” Kalesnikoff said. “And we shouldn’t just limit it to homes, we should be building schools and hospitals and retirement homes.”
Increasing the domestic use of wood on that scale could take up a quarter of the lumber we typically export to the U.S., which would “reduce the pain” of the lumber dispute, Kalesnikoff said.
The task force has bigger ideas for modernizing and retooling the industry and recommended a $10 billion forest sector transformation investment fund.
Kalesnikoff said their intent is that the fund would be capital that businesses could leverage with other investments that earn a return for government.
However, Kalesnikoff added that the task force hasn’t been given an indication of how that $10 billion recommendation is being received by government.
“All we can do is encourage government to do that,” Kalesnikoff said. “If they choose not to, or come up with something different, then we’ll have to deal with that.”