Future of Forest Industry “Pretty Solid” Says COFI VP
Prince George, B.C. – Slow and steady growth along with diversification in the marketplace “spells a pretty solid future” for B.C.’s forest industry.
That from Council of Forest Industries (COFI) vice-president Doug Routledge.
“Well the industry continues to recover from the recession,” he says. “And certainly is taking it’s time to materialize, but that’s no necessarily a bad thing.”
Routledge says slow and steady growth “means it’s fairly easy to business manage and predict.”
“You can tune your production and your capital investments in a more business like fashion, rather than trying to react to quite violent swings.”
He says another reason for optimism is the diversification going on in the industry.
“We’re going through quite a transformation right now. Where the fundamental building blocks for the business have been lumber, panel products and pulp and paper,” says Routledge.
“We’re increasingly producing other kinds of forest products out of the forest using parts of trees, fibre that we didn’t use before and would have left in the bush.”
He says that includes things like residues out of sawmills, laminated lumber and laminated panels.
“So that diversity of product line and the slow steady recovery I think spells a good future for the industry.”
Routledge admits though that means bad news for some. “There won’t be as many employed in lumber because lumber is contracting. There’s more people employed in these, what we’ll call secondary product lines.”
He also notes that on balance, the weak Canadian dollar is helpful to Canadian forest products flowing into the United States, adding a reduction in lumber demand from China hasn’t been too damaging due to changes in the domestic market.
“The building code in B.C. changed and we’re able to build six storeys in wood now (previously it was four),” he says. “And in Quebec recently they’ve raised that up to I believe 10 or 12 storeys. So the growth in that area of product supply is probably where the more important gains are going to be made in terms of volume flowing.”
Comments
Give Harper four more years and we will watch as he signs our lumber industry away with a lift of tariffs on raw log export….
Just like Ontario suffered from NAFTA as their manufacturing sector was devastated, BC will see the demise of our Lumber Manufacturing segment of our economy…
Free Trade for Stephen Harper means the opportunity for foreign investment to have access to Canada’s resources at as little impediment as possible including any sort of value add….From elimination of ALL tariffs ……to the freedom to import these foreign investors to bring in their own labour force …..to stripping of anything environmental….to the silencing of opposition in C-51….. to the implementation of Investor Protection clauses that does nothing but take the power away from the Canadian people and places it in the hands of foreign entities to operate how Canada does business…
Give Stephen Harper one more mandate and we can watch as our sawmills are shuttered and our Logs are trucked or railed to the nearest Port…
Its all Harper’s fault!!!! Get rid of him and we will all be rolling in the dough. Taxed out you come up short on political history with the liberals.
I wonder if the writers know that the Conservatives delivered hundreds of millions of dollars to the forest industry in Canada. Money for research and technology to attain higher value from wood fibre, money for global marketing of Canadian wood, money to assist pulp mills and sawmills operate in a much more environmentally manner, and money to fight the US forest industry lobbyists who have been constantly creating trade dispute in their efforts to confound the Canadian forest industry.
Yes you can blame Harper for every one of those dollars spent assisting our forest industry.
Perhaps the anti Harper posters might want to call the CEO’s at Canfor, West Fraser, Tolko, and other majors to become a little more enlightened about the support the the Conservatives have given to Canada’s forest industry.
Oh…just an aside…and wasn’t your MP Dick Harris the Chair of the Conservative National Forest Caucus for the last 9 years ???
So what happened to the billion dollars promised for the communities effected by the pine beetle epidemic? Promises made and promises broken. Handing out money for monopoly capital is not the way to diversify the economy.
Signing a softwood deal with the Americans that penalizes Canadian producers after we won in arbitration is not the kind of negotiator that is looking out for the softwood sector, but rather one that uses it as a bargaining chip for other nefarious ends.
Eagleone…again I suggest that anyone who thinks Harper and the Conservatives have not been an immense benefit to Canada’s forest industry should immediately call the leadership of Canfor, West Fraser, Tolko to get their comments….I know they will diametrically opposite of those who think the Conservatives have done nothing for the forest industry. These three companies employ thousands of BC workers directly and create many more thousands indirect jobs in BC.
And your softwood lumber comment is nonsense….The Conservatives had almost 100% of Canada’s forest industry onside and assisting before signing.
Go ahead..call
I remember Rustads Mill at one time was highly competitive in both Safety and Production, meetings held with management/employees (information meetings) showed persons through powerpoint graphs and pie charts that Rustads was in a solid second place out of all existing mills at that time (2006). “We will never be looking at shutdowns or scheduled time off” (Rustads mill Manager Cris Barber) they were then bought out by Mr Jimmy Patterson who started to export the logs designated for Rustads to overseas operations due to cheaper labor. “Hold on you can’t do that to the employees of Rustads! no logs equals no work for these employees! keep the stumpage here!” (government) “ya! this is my mill! i can do what i want with my mill, and those logs are part of my mill..you don’t like what I’m doing? then ill shut er down!” Jimmy called the bluff…210 persons unemployed with a one day notification.. two yrs of debating and talks to finally get pay out…shows that government has some hands in some failures, but some rich persons greed can also effect those around them Sociology 101
there are two sides to every issue..and sometimes even more tangents than that.
With lumber futures for November at $225 per thousand, we’re likely looking at sawmill curtailments this winter. And as the beetle salvage program draws to a close, look for a few more sawmills to close permanently in towns where the timber supply was mostly pine. You might ask how healthy it is to have three companies controlling virtually the entire Interior forest industry. Company town, anyone? The long term looks bright, however, as BC has lots of advantages including a land base that grows great trees.
CL
Yes, Theory, but for every ‘buyer’ like Jimmy there has to be a ‘seller’, like the previous owners of Rustads. Why did they sell if their business was so viable, and in “…solid second place out of all existing mills at that time”? Could it be that their profits, taken not as a dollar amount over the previous year’s profit, but rather as a percentage of their sales, weren’t rising, but falling? Pretty hard to counteract that except by getting bigger and bigger, and even that really doesn’t work in the final analysis. Where are all the once great coastal giants of the forest industry that went that route? All gone. What’s left is Western Forest Products Ltd., whose controlling owner, Brookfield, is prepping for sale at the first opportune moment. Not hanging onto in the expectations that profits as a percentage of sales are going to increase.
“Why did they sell if their business was so viable”
Ever hear of the saying “sell high, buy low”?
It was easy to see what was going to be happening with midterm timber supply in this area after the MPB hit. The idea is to take advantage of the salvage period as best as one can, make the business look good financially, sell at the highest price one can get, and close shop, then reinvest in another business or simply retire.
Notsofast, do you work in the forest industry?If you do, and you are part of upper management, then you feed off the nothing will go wrong,we are all good rhetoric!If you do work on the union side of things you will, and should always remain skeptical of everything the others have to say!I have always been on the non-management side of things and had the rug pulled out from me in many different industries,and I trust no one in Governernment or Management.Especially when they spread their trust us, we know everything knowledge!
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