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Trade Mission Paying Off for Forestry Companies

By 250 News

Friday, November 05, 2010 01:49 PM

Minister Pat Bell and USW Local 1-424 President Frank Everitt at  construction site in China
Prince George, B.C.- Companies taking part in the forestry trade mission to China have generated sales of 418 million board feet of lumber, says  Forests, Mines and Lands Minister Pat Bell.
 
"Total sales orders taken by the 2010 trade mission are five times greater than the China mission of just two years ago," said Bell. "This incredible surge in demand shows that B.C.'s annual trade missions and other marketing efforts to grow the Chinese marketplace are paying off in spades."
 
Tolko Industries benefited with two major contracts finalized during the trade mission.
 
One contract will see Tolko's Soda Creek division shift its focus to supplying stud lumber to China National Beijing Materials (CNBM). The second signing was the renewal of a contract that has Tolko shipping the entire output from its Quesnel operation to China.
 
Other B.C. mills that have re-opened or added shifts to take advantage of strong demand in the rapidly growing Chinese market include Canfor in Quesnel, Western Forest Products in Ladysmith, and National Choice Specialty Wood in McBride.
 
"Given the downturn in the U.S. market, the continued increase in sales to China is excellent news for our folks," said Frank Everitt, president, local 1-424, United Steelworkers Union. "The momentum in the China market not only provides for continued employment for workers across the North, but also opportunities for more mills to re-open."
 
In addition to volume, the B.C. forest industry is also seeing a significant increase in the quality of lumber being exported to China.
 
An estimated 35 per cent of softwood exports to China are now construction-grade quality, compared to just 10 per cent a few years ago when the bulk of orders were for economy and utility grades.
 
"It's clear to me that government's strategy for marketing B.C. wood products in China is working," said Hank Ketcham, president and CEO, West Fraser. "Since my first trade mission two years ago, I've noticed a dramatic increase in wood sales. As well, instead of us promoting wood, many developers we met with were telling us the benefits of working with wood."
 
The forestry trade mission, led by Bell and including senior executives from industry, made several major breakthroughs to promote wood-frame construction and boost the demand for B.C. lumber in China's major population centres of Shanghai, Tianjin, Beijing and the Hebei and Sichuan provinces.
 

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Ummmm , why is Frank Everett always in the forefront? He runs a union, not a sawmill.
Makes one wonder..
You are aware that there is a thing called lumber which doenst have a market right now.. And you need sawmills to cut lumber which have unions tied to them. So if mills arent cutting lumber.. Frank and His union are out of jobs.

Good to see them over there generating some business.
Somehow, I don't think the picture was taken in China. kind of embarassed about it, Please don't send them pictures building with OSB.
Oh its China alright, busting into this market with increased sales of lumber great and better than exporting logs. so go boy open it up what ever it takes to get the job down and people back to work.
Hey there Frank. For a fellow that is so "anti-liberal" you sure look happy! Was it my dues that paid for your "vacation" OR was it the current political party that you so much distrust???? Worse thing that ever happened to the forestry workers is to have MR.EVERET back in control!!! What party do you think Frank will run for next election?????
I would presume they are standing in front of a two "rickshaw" garage. Correct me if I'm wrong.
Nice to see our Union President out there in the fore-front! Increasesd lumber sales equals increased production, which hopefully brings another mill back to work.
So Frank, now that you have reached agreements to put Canfor Quesnel, Canfor Chetwynd, Conifex Ft.St.James and Conifex Mackenzie all back to work, it's time to get Winton Global to the table!
I hope Winton Global is over there with you!
How did we ever build homes before OSB?
Guess that was back in the olden days?
Seems rather strange to me that a Union President would be front and centre at a construction site in China that probably pays its workers 8 bucks a day. I dont think Unions are very well received in China. I wonder if Frank could convince them that they should pay their workers at least $18.00 per hour.??

Until I hear what these mills are paying the Government for stumpage on these beetle killed trees they are using to make this utility lumber, and the price that the Chinese are paying for the lumber I am not going to get too excited.

Hasnt anyone noticed that the sale price of the lumber is never mentioned. Are we giving the trees to the lumber companies really cheap so that they can make a buck, and if so are we the taxpayers actually subsidizing these companies?? Who knows.

With the US price being the highest paid running at about $255 per 1000 fbm it doesnt leave much room to make a dollar.
u guys and winton global! it will never ever reopen why do u winton global guys keep on crying and crying just move on please! the rustads guys got the shaft at the worst possible time and have moved on! timmmmmmmmmmmmme is supposed to heal wounds but u winton global guys i dont think it works for u guys
frank ur bellys getting bigger with the union dues! pat bell keep up the good job and feed frank the spicy chicken combo,with diet coke
Why do you think we want WG to pay what's owing to the employees? Once they get their severance, they will move on. And how do you know it will never reopen? Do you know something we don't know?
If its going to re open then they better get some logs in their sawmill yard in Bear Lake, and some rough lumber in the yard in Prince George to plane. At the moment they have neither which indicates to me that they dont plan on opening soon.

Rustads is the same. Not one log in the whole operation. No logs, no start.
Rustad is gone forever. It cost to much to operate and fire up. Canfor will put its money into a super mill before they open Rustad and Clear Lake.

Don't be surprised if they have a mill that pumps out a billion bd ft a year. It will run 24/7 and shut down for two days a month.

I am sure that whatever government takes over from the fiberals would do an equally as good and probably better job. When ever a government does what it is supposed to do it should congratulate iself and move on and do other good things. But in the case of the fiberals what can I say? You sold B.C. rail, you've lied to the B.C. people about the H.S.T. and just about every thing else. You've lost the trust of the people big time so get the hell out of our way so we can elect a government.
http://en.wikipedia.org/wiki/Fast_Ferry_Scandal

How soon some of you have forgotten the bungling from the previous government.

Ron J Davis
I would rather put up with mistakes rather than put up with delibereate lies and a government that sells the main tool that the peopled could use to haul this province out of it's miserable condition that we find our selves in. Maybe if the fiberals hadn't sold the Fast Cats at fire sale prices and sold B.C. rail and instituted the H.S.T. and lied to the people all of the time they might have made a government??
I just hope Frank is travelling on government coin and not my cash strapped union dues.

Frank
Right on He Spoke....Supermills seems to be the trend and have been for a long time now.
Still too many inefficient dinosours running out there, as far as the compamies and the industry is concerned.
Eventually they will all go and everything will be more centralized.
Unfortunate for the workers for sure, but I think it is unavoidable in the future.
Sad really,the end of an era.
A lot of mills have come and gone in the last 50,60 years in the area.
There is a lot of sawmilling history from Terrace to McBride,but even more so in the surrounding PG area.
The supermill model will prove to be a disaster for BC. Sure, it lowers the unit cost of every stick produced. But it's still the TOTAL cost, of ALL the units, that has to be liquidated.

And when that can't happen, which will be more likely than not, the costs of production will be too high to operate.

And the government will have to subsidise that mill in some way to ensure that anyone is still employed, or still around to be employed, when it's able to run again.

When the beetle kill is gone, there's going to be a need for smaller, more flexible sawmills than what we've known. The trend towards "bigger is better" will be reversed, simply because there won't be enough fibre to keep a supermill going.

And the cost of reaching out beyond this area for it will negate the advantages of super production.
On a positive note, while these sawmills are all sawing up the bettle kill wood over the last 10 years, the spruce is being saved. This is a fact . So its not like we will be out of wood just cause the bug kill is all gone. The forestry has been right on with this planning. So the spruce is growing. We still have a large wood supply. Have a nice day.
Yes, there was much bungling from the previous NDP government. They got what was rightly deserved when they were turfed in 2001. Even though we didn't, with what replaced them.

But with regards to the FastCat Ferries fiasco, lets not forget that the costs of that particular bungle stayed here in BC.

People here got work and wages out of those boats' construction. BC suppliers sold product here, as they provided the goods and services necessary to build the ships. Wages were spent here, to boost the local economy. And most importantly, every dollar spent was taxed, in one, or more likely, many ways. Returning what was spent every time they were.

What did we get out of building three ferries in Germany?

We have three new boats that have not been without their own share of problems. Just last week the loading doors stuck (again), and the ship had to be turned around and every car backed off to unload. One, so I've heard, is generally tied up, and used to cannibalise parts of off, until spares can be flown in from Germany.

But aside from that, what did the Germans spend the money we sent them to build the boats on? Did our sale of BC made products to Germany take a dramatic increase? Sufficient to provide us with equal or greater benefits to exporting the shipbuilding jobs, and all the spin-off benefits overseas? Did we recover ANY of this money in taxes? To OUR advantage? Or did the Germans just invest in more Chilcotin and other BC 'wilderness' real estate? Driving up the price of same, and making the tax take from British Columbians already living and working there that much more onerous? While pricing us out of the market to live in our own country?
I am a long time reader, but this is my first post.

I've traveled and worked extensively in both China and Russia having been to every Province in the PRC and numerous areas in Siberia and the Russian Far East. I'm also a native of Northern British Columbia and worked my way through two degrees slogging it out in the bush as a silviculture surveyor in the Mackenzie TSA.

Every day I wake up and read media regarding the much vaunted, 'historic' and savior-like nature of MLA Pat Bell's super team escapades in the PRC.

I would like to commend their efforts at.
That is though, typical of a Western politician who calculates in time horizons of 4 years or less. This is in stark contrast to their Chinese counterparts who think in decades..at the minimum.

Their unbelievable short-sightedness, failure to understand long-term Chinese goals and refusal to adequately address the Russian question absolutely sickens me.

One of the conveniently overlooked reasons why BC lumber is popular right now is the presence of an 80% tariff placed by the Russians on lumber/log exports in an effort to spur investment in their own industry. Much of this investment is being bankrolled by Chinese interests. Once said infrastrucre improvements come online, China will have almost complete control of super cheap lumber sources. This long-term strategy falls in line with their resource collection goals in South East Asia and Africa. Control.

Meanwhile, BC companies and government continue to bankroll the PRC with wood construction technologies, technical talent and knowledge, thus allowing them to build up their own capacity to build with wood, using their own Russian sources. For some reason, BC politician and industry leaders seem to think that their 2x4's will be the resource of choice, despite the coming presence of new Chinese owned mills directly next door to the Chinese market.

None of this is particularly new...it's just completely under-reported in favour of glory stories.

It just saddens me that folks are buying into China so naively. There are some markets, for sure. But the over-hype and over-investment in this market is going to kick the forest sector balls in 10 years

Long-term though...what a novel idea.



Runner 46 still bringing up something from over a decade ago.Have you noticed the liberals have screwed up ten times as much since then,or do you have the liberal genetic gene of hear no evil,see no evil.BC Place roof is one of there latest screw ups.Hope they don't open the roof and then get a torrential downpour or rain for hours on end,because they can't close her back up in time to keep the people dry or anything else inside.People will only remember or pay attention to what effects them personally.So if the NDP did something that cost someone there job,of course that person is going to have a hate on for the NDP for many years,and ditto for people's feelings towards the liberals.
Kind of funny pgguru, most of the people from Rustads that I spoke to have far from moved on. They are awaiting either a reopening or severance. That is the reason the WG folks can't put this behind them as they have had no sense of closure. They have been jerked around by an unscrupulous employer in ways that Canfor hasn't dreamed of yet, so yeah I think they have every right to vent their frustration in a public forum. Walk a mile in their worn out shoes before making off the cuff remarks. You don't have a clue what you're talking about.
mythoughts when ur sawmill and planer are in two different parts of the town do u call this feasable operation? and if u want to transport it out to bear lake the cost would be huge.
detoe43,there is a big big surprise about happen for the rustads employees and mythoought i really wish winton global would re open to,im reall sorry for making comments like that but sometimes we cant control these things.winton global sawmill has the greatest location but its missing second half of the operation witch is totally on the wrong side of the town
Jakeadoo wrote: "BC Place roof is one of there latest screw ups"

I am not sure why you would call it a screw up and why it is placed at the feet of the government.

If there is a screw up, why do you not look at the original roof. The original roof needed to be replaced eventually. Any idiot could have have told you that when it was first installed. However, like most things, that was not considered in the equation, thsu there was no money set aside for it. It was passed on to the future generation to fix.

Any idiot could also have told you at that time that replacement of that roof would have had some down time to it. Not like replacing a tar and gravel roof that can be done without interfering with the activities inside the building.

It is virtually impossible to create a fabric folded roof which can be opened and closed in extensive wind or a downpour.

It's simple. You think it is goign to rain, close it!

You think it will not rain. Keep it open!

That is what the engineers told the owners, that is what the owners accepted.

It is the media that is making a big deal out of absolutely nothing.

Of course, they could have spent 5 times as much to place a rigid opening roof over the building such as Toronto has. That was not impossible, just too expensive.

Then the people would have been upset at the cost. Can't win either way.

As someone so eloquently said recently, in the political arena it is easy to knock something but extremly difficult to provide the kind of information to the general population that it takes to explain the rationale for doing something so that they understand.

As I prefer to call it - functional illiteracy. The world is getting too complex for everyone to udnerstand everythting. A little street smarts about things technical would help.
It will not work. I know someone who immigrated to canada from china. The chinese are ordering because Canada is doing them a favor in other areas. The person I know has knowledge that the Chinese and the Japanese feel that the wood from Canada is too expensive and they can obtain the same quality from elsewhere. They are already ordering from other countries also and are in the process of comparing costs.
Good post tingbudong. Thanks.
Thaks Palopu, although upon second reading I realized I should have spent more time editing.

Imorge also makes another valid and too often overlooked point in this debate. Price. I believe much of the theory on these trade missions is that China will buy up the quality chain, dropping low quality cuts in favor of more expensive units. However, the trade wizards again seem to ignore the basis of Chinese trade policy...resource and manufacturing control. Why would they want to purchase products they can get and build themselves? At a fraction of the price. Furthermore, Canada has proven again and again it's blatant inability to develop a strong value added forest product market.

I'm in the city planning field and have a few contacts in China (alumni I shadowed last year in Shanghai) whom all remain skeptical of large scale use of wood in their developments largely because of its cost relative to locally produced concrete and steel. They are not convinced wood from BC is the better route.

Canfor also screwed up big time with their first foray into the Chinese market a number of years ago. They bet that wood frame single-family home construction (what are known as "villas" on the Mainland) would begin to take hold as a major form of construction. They were led on partially by the Chinese (who have a habit of telling a person/company exactly what they want to hear) that this was a massively growing niche, and it was...for awhile. However, recent land reforms in most Mainland province have effectively put the halt on big single-family home developments.

Another point (and I'm going a bit out on a rung with this one) the folks on these trade missions, especially representatives of BC communities...with all due respect are B and C list politicians. Most have done little time abroad, most likely cross-cultural virgins and China loves to roll out the red carpet and wine and dine people of this caliber like they have never been wined and dined before. It's unbelievable easy to get caught up in the VIP existence while in China...believe me, I know, first hand.

I'm being cynical, but every time I hear of another group of Mayors, MLA's and their similars heading over to the PRC...I can't help but think of more, expensive dinners, KTV and Massage Parlours. Its how it all goes down over there.
gus says, "I am not sure you would call it a screwup and why it is placed at the feet of government."

Really gus, original cost was supposed to be $355 million, it is now $577 million for the roof. The roof has yet to be completed. The screwup has nothing to do with whether the roof can close or not gus. The screwup is that the BC Liberal government have proven over and over again as the worst fiscal managers in BC history.

Remember gus, a $400 million dollar projected deficit that turned out to be $2.4 billion deficit.

These guys make fast ferries look like spare change.
tingbudong. You are right in thinking and realizing the fact that our politicians cannot see past the next election. And by the way, it is also a fact that the first job of an elected politician is to get re-elected again. Very sad.
Re-elected again? A redundant phrase? Any English teachers out there?