Editorial: Reflecting on the past year in forestry
Dec. 4, 2017 - Birthdays are a good time for reflection. A time to think about what we accomplished over the past year. For those in the business of wood, Canada’s 150th year was full of ups and downs.
The softwood lumber trade dispute between Canada and the U.S. took an expected turn for the worse in April when the U.S. announced preliminary countervailing duties of 19.88 per cent on most Canadian lumber producers; some were higher, some lower. An anti-dumping duty was added in June amounting to 6.87 per cent on average. The so-called gap period – when the preliminary duties expire and the U.S. has yet to determine the final duties – began in late August. Final determination was announced on Nov. 2 with most companies falling under a combined rate of 20.83 per cent.
It’s a frustrating cycle but from what I’ve heard lumber producers in Canada are involved in the conversation and made the most of the gap period. Interestingly, throughout the year Canada’s major lumber producers posted increased quarterly profits in spite of the uncertainty and preliminary duties. The high price of lumber is buffering the effect of the taxes.
Plans to protect Canada’s dwindling number of caribou also made waves in the latter part of the year. Forestry associations were among the stakeholders clamouring to have their concerns heard as the federal government pressured provinces to uphold an agreement reached five years ago to protect threatened caribou herds.
Forest Products Association of Canada’s Derek Nighbor was among those speaking out in the media about the potential for restrictive protection plans to jeopardize forestry operations. “If you start shutting down mills you are putting families at risk and it’s not certain you’re addressing the caribou problem,” Nighbor said in an interview with CFI. The plans need to include complex science, local consultation and socioeconomic factors, he said.
In B.C. wildfires set a new record for damage, consuming an estimated 53 million cubic metres of timber. We know that amounts to a long-term challenge for forestry players there, some of which are already salvaging the burn area.
On the other hand there was plenty to celebrate as Canada turned 150.
A major announcement came in September when the Canadian Council of Forest Ministers unanimously supported a forest bioeconomy framework to increase and ramp up bio-based projects in Canada.
“The bioeconomy presents Canada with tremendous opportunity to create more jobs, develop new supply chains and build a new industry,” Canada’s Minister of Natural Resources Jim Carr said in a statement heralding the announcement.
FPInnovations applauded the framework, calling it a “clearly defined roadmap that opens the door to further enhancing the sustainability of the forest sector.”
Similarly in June the federal government launched a low carbon economy fund worth $2 billion, which will in part support projects in the forest sector to enhance stored carbon.
In B.C. the provincial government has appointed a third party to conduct a contractor sustainability review. According to the Truck Loggers Association’s David Elstone, the review is “the most significant announcement to affect timber harvesting contractors across the province in almost 20 years.” A final report with suggested solutions is expected by the end of the year.
And in Natural Resources Canada’s (NRCan) annual State of Canada’s Forests Report for 2017 there are encouraging numbers. In 2016 the forest industry accounted for seven per cent of Canada’s total exports, injecting $23 billion into the economy and generating $1 billion in revenue for provinces and territories. The industry supports over 211,000 jobs, which includes about 9,700 Indigenous people. Looking ahead to next year, the message from NRCan in the report is again innovation in the face of climate change.
I’m looking forward to sharing stories as forest companies rise to occasion and adapt to face these challenges. For an industry that has been an economic cornerstone of Canada for 150 years, I expect nothing less.
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