BC Business
The executive weighs in on the sector's current struggles and its future promise.
1. To illustrate the scale of the crisis that has swept the B.C. forest industry, can you share a few facts and figures?
We’ve had over 100 curtailment announcements at B.C. operations, some temporary and some permanent. Those are now impacting thousands of workers in about 50 communities.
2. Why should British Columbians who don’t live in forest-dependent communities care?
Forestry has been and continues to be vital to the provincial economy. It supports over 100,000 direct and indirect jobs, and importantly, those are good, family-supporting jobs for mill workers and logging contractors, but also for port operators, scientists and a whole bunch more. And they’re located in every region, including the Lower Mainland and the Southwest, where over 40 percent of the forestry workers reside. So there is no rural-urban divide when it comes to forestry, and it drives a big chunk of the economy that helps pay for the health care and education we all rely on. What’s good for a forester in Fort St. John is also good for an accountant living in Vancouver.
3. What are the main causes of the downturn, and to what extent are the industry’s challenges structural rather than cyclical, given climate change and the mountain pine beetle?
We’ve had volatile market prices. We’ve had trade tariffs from our largest market in the U.S. We’ve had the impact of declining fibre availability on the coast from other uses of land, and in the Interior we’ve had a prolonged beetle infestation and then two devastating years of forest fires in 2017 and 2018. That is impacting the availability of fibre and the cost of fibre, the most significant input into a forest product.
There’s no question that we’re going through a structural shift. We also work in a cyclical business, so that variability has occurred over time as we go through the ups and downs of markets and demand for our product. But this time really is different.
4. Why has COFI proposed designating a “working forest” land base? Environmentalists would argue that despite conservation zones and protected areas, our forests have been worked pretty hard already.
We think it’s important that we both invest in and protect the working forest land base. If you look at the Ministry of Environment and Climate Change numbers, about 52 percent of the land base in British Columbia has some form of conservation measure on it. That’s a huge commitment, and it’s important.
But we also think there should be balance. In addition to the conservation values that we all support, we value the renewable resource because it provides jobs and economic opportunities for families in communities around the province, and about $2.5 billion in annual stumpage and taxes alone to support things we also care about, like health care and schools and infrastructure. To provide security for people to make the choice to invest here, they need to know they’re going to have access to fibre at a reasonable cost to manufacture a wide variety of products that the globe wants.
5. How can we turn things around? What should be done to help companies and workers?
If we can reimagine and prepare ourselves for the next iteration of our sector and the opportunities that are there, we will be better able to secure jobs and communities going forward. Government has a role in creating the conditions, ensuring we have access to the fibre, ensuring that the regulatory regime is robust and strong but also efficient and streamlined, and can be done in a cost-effective way. For industry, we’ve got to continue to look at our market and product diversity and how we extract even greater value from the fibre.
And then we need to think about the green building opportunities that are in front of us all. Around the globe, people are looking more and more to wood, not just for traditional two-by-four housing construction but for multi-storey buildings or tall wood structures for mass timber buildings. We are heading into a golden opportunity for wood to address the climate change challenge, and if you build with wood, it’s storing carbon for the life of that product.
If we make the right decision now, I think we can attract the investment that’s required to set ourselves up to thrive. We are completely capable of being a globally competitive sector that’s a world leader in product innovation and technology and environmental care, and that can support jobs and communities across British Columbia.