Round or dimension lumber Pat???

Russia did not put on any restrictions on sales of logs to China. Putin put a stop to the endeavour.

Chinese exports of lumber to the USA was 3% in 1997.

This had increased to 13% or more in 2006 and has increased since.

China has easy access to Russian trees, and therefore we can conclude that they will supply most of their needs locally.

They may very well go to wood frame contruction housing, however it does not necessarily follow that the wood will come from Canada. Hopefully it will.

China was an exporter of Oil until 1993 and supplied most of the oil needs of Japan. It has now become a net importer, and gets its Oil from Venuzala, The Middle East and Malaysia. Very little at this time from Canada.

We have been trading with China for 30 years or more, so I dont understand why people think this is all new business.

What it is, is highly competitive business and we have to ;pull up our socks if we want to compete.

There is a big world out there and the Central Interior is a very small part of it.

Central Interior? Bell is the Minister responsible for the forests and range lands in the entire province, not just the Central Interior. He might sell wood from just part of the province. Maybe from here. Maybe from someplace else.

The wood China is selling to North America is likely not pine, spruce, fir, or cedar. More likely finished products from wood such as bamboo and other exotics.

News from The Globe and Mail

China tour highlights severity of forestry downturn
Struggling companies hope to crack vast market, lessen dependency on U.S. housing
BERTRAND MAROTTE AND DAVID EBNER


00:00 EST Monday, November 17, 2008

MONTREAL and VANCOUVER -- A weekend stop on a tour of China highlights the severity of the crisis gripping Canada's forestry sector.

The challenge was clear as industry leaders from British Columbia visited the earthquake ravaged Beichuan county region in Sichuan province.

They are trying to sell the virtues of lumber to a country that is using bricks to build and rebuild.

Although it's a country largely without carpenters, B.C. Forest Minister Pat Bell says China could go from taking just 2 per cent of the province's lumber exports to more than 25 per cent within four years.

This would be a big victory that would help reduce the Canadian industry's dependence on a U.S. housing market that has collapsed and shows few signs of rebuilding any time soon.

"When people have never seen a wood building built, it's not hard to understand why you don't see many wood buildings here," Mr. Bell said in a weekend interview. "The real key is education. If we get people thinking about wood, it'll grow very quickly."

Forestry executives are now considering something similar.

The provincial and federal governments are also spending several million dollars in the earthquake zone on rebuilding projects to showcase B.C. spruce, pine and fir, including an elementary school in the area.

That growth is crucial. Not only is the U.S. housing market stalled, there is also stiff competition from low-cost rivals in emerging economies, coupled with high energy costs and a volatile dollar. And, of course, a global credit crisis.

The signs of pain in the forestry sector are everywhere, from struggling mill towns to wood pulp piling up at Vancouver's port.

Warehouses are bulging with pulp as the severity of the current economic upheaval takes hold and Asian - particularly Chinese - importers run into difficulties getting access to letters of credit to pay for the product.

It has reached the point that locations to stockpile the pulp are being sought in the B.C. interior, said David Bedwell, executive vice-president at international ocean shipping firm COSCO Canada.

"The order books are empty," said Avrim Lazar, chief executive officer of the Forest Products Association of Canada. Worse yet, he added, "the yards are full."

It is these conditions that sent Mr. Bell, Canfor Corp. chief executive officer Jim Shepard, West Fraser Timber Co. Ltd. CEO Hank Ketcham and others to China.

Chinese officials say they prefer to deal with one entity, rather than several companies, similar to dealing with Canpotex Ltd., the potash export group that represents Potash Corp. of Saskatchewan Inc. and others companies. Forestry executives are now considering something similar.

"It's a survival situation," said veteran industry watcher Csaba Hajdu, a former chief economist with MacMillan Bloedel and a consultant with Forest Industrial Relations Ltd. of Vancouver, a labour-bargaining agent for forestry companies.

"It's a situation where you do what you have to do to survive," Mr. Hajdu said.

There's no choice but to look beyond the United States.

Benchmark lumber prices are down to about $190 (U.S.) per thousand board feet from $260 in August.

Home builders last week said things will get worse as housing prices fall lower. Even low prices can't convince people to buy: Robert Toll, head of U.S. builders Toll Brothers Inc., said confidence among home buyers has never been this low.

The casualty list is hefty as the shocks course through the sector.

Already, Madill Equipment of Nanaimo, B.C., an institution in Canadian forestry equipment, has gone under.

The downturn is affecting many companies, for example, AbitibiBowater Inc. is facing shrinking newsprint and magazine paper markets.

For Montreal-based Domtar Corp., a maker of fine paper, layoffs on Wall Street and other financial centres in the United States are having a direct impact on sales.

Among the sector's cutbacks, Domtar is shutting down its paper machine and converting operations at its Dryden, Ont., mill, slashing 195 jobs, while Tembec Inc. plans to cut production at three pulp mills in British Columbia and Quebec. Canfor has curtailed production at its Taylor Pulp mill.

Domtar's retiring CEO Raymond Royer warned recently that the outlook for 2009 is highly uncertain and that more cutbacks at higher-cost operations may be required.

Still, companies are acting.

"Our top priority, given how volatile the economy is right now, is to focus on the things we can control, namely costs and cash conservation," said James Lopez, CEO of Montreal-based Tembec, which refinanced last February, before the credit crunch became so severe.

The recent fall in the dollar, making forestry exports cheaper, is some help, but comes at a time when demand is down and prices are terrible, said Luc Bouthillier, a forestry economist at Université Laval.

The message? Expect more layoffs as yet more mills and machines are shut down.

Mr. Lazar, chief lobbyist for the industry, said the sector wants smart help from Ottawa, not massive bailouts.

The list includes access to credit through this dark period; refundable research and development tax credits; regulations that allow companies greater freedom to close mills, reducing overcapacity and improving financial results; and Competition Bureau rules that enable consolidation.

"Fix the competitive conditions," he said.

© The Globe and Mail

Seeing as how them Chinese folks are heavy smokers and the government there does not discourage them from quitting maybe we should send them a couple of tons of asbestos gyprock with which to sheet their houses with. Melamine and lead from them and asbestos to them from us. It doesn't matter to them. Why should it matter to us?