West of the oilsands, another sector suffers its own ’existential crisis’ in silence


Mowich
+3
#1

The Ministry of Forestry estimates about 8,000 people, or roughly 15 per cent of those employed in the sector in B.C., have been touched by the cuts, a massive blow to the province, which produces about half of Canada's lumber with an annual export value of $14.2 billion.Postmedia


If a tree falls in a forest and no one is around, it doesn’t much matter if it makes a sound, except to philosophers. But if a sawmill closes in a remote British Columbia town, where the internet is patchy, the impact is all too real even if no one outside hears about it.

That’s about what retired forester Jerry Canuel was thinking to himself in September when an annual logging show rolled into his hometown, Merritt, B.C., also known as Canada’s country music capital, where a once thriving forestry sector has been slowly disappearing.

At the show, axes were thrown, logs were sawed and Canuel bumped into so many out-of-work loggers and millworkers that it spurred an epiphany for him and some friends: If they all descended on Vancouver, about three hours southwest of Merritt, it might bring some attention to the troubled state of the province’s forestry sector.

“There’s so much silence,” said Canuel, who remains an adviser to Aspen Planers Ltd., which operates the lone sawmill in Merritt.

“There’s just nothing being said and a lot of people don’t know the significance of what’s going on in the Interior.”

At least nine sawmills in B.C. this year have been shuttered while an estimated 47 others have cut shifts or curtailed production, leaving many remote communities economically stranded. The Ministry of Forestry estimates about 8,000 people, or roughly 15 per cent of those employed in the sector in B.C., have been touched by the cuts, a massive blow to the province, which produces about half of Canada’s lumber with an annual export value of $14.2 billion.





“Everyone thinks about the sawmills, and the people who work there, but it’s also contractors and people who deliver wood to the mill, mechanics, equipment sellers,” said Todd Chamberlain, president of the Interior Logging Association. “In the smaller towns, it’s right down to the people who cut your hair.”

Unfortunately, forestry, like oil and gas in Alberta, is another major resource sector experiencing an intense bust cycle, and it’s also one where the largest companies are seeking growth opportunities outside Canada, mainly in the U.S., further fuelling the sense of discord in the West.

The B.C. Interior, where most of the wood is cut, has been particularly hard hit by a mountain pine beetle epidemic, which peaked around 2006 and left huge swathes of previously wooded areas bare. But the rest of the province has not been spared, as record forest fires and a long-running trade dispute with the U.S. have taken their toll.

Now, with the timber supply projected to shrink until 2025, and a recovery expected to take decades, companies are “rationalizing” their operations in B.C., consolidating mills to gain efficiencies of scale.

That some of B.C.’s largest timber companies are also investing in a rapidly growing timber basket in the U.S. South, while some of the smaller companies are feeling the squeeze, has not passed unnoticed.

The weekend following the logging show in Merritt, a convoy of big rigs snaked out at 9 a.m. and headed for Vancouver, where mayors from around the province had gathered for a conference.

“We thought we would have like 50 trucks at the most,” Canuel said. “Well, my goodness, I think we had in the neighbourhood of 267.”

Along the way, people huddled on overpasses and the sides of the road, holding up signs and cheering on the convoy, which continued to grow along the way until it stretched for several kilometres by the time it reached the city.

Canuel felt strongly the convoy shouldn’t be deemed a protest or confrontational. After all, who could be blamed for the mountain pine beetle and fires that wiped out the trees?

But with 95 per cent of B.C.’s timber located on public land, there has been a populist backlash against the largest companies including Canfor Corp., Interfor Corp., West Fraser Timber Co. Ltd., Tolko Industries Ltd., Western Forest Products Inc. as well as others.

“The consolidation of volume into these four or five companies in the province is taking out all these small companies,” Canuel said.

“What we’re trying to say to the government is, goodness gracious, what do you want in this province? Do you want multinationals, five of them, controlling all of this province?”





A forest fire rages through the trees near Lillooet, B.C. Record forest fires and a long-running trade dispute with the U.S. have taken their toll on the forestry sector. Postmedia

Even on the coast, where the mountain pine beetle has had less impact because of the different tree species, there is a similar hostility toward the largest companies

For example, Interfor in September closed its Hammond mill in Maple Ridge, saying a lack of fibre meant it was operating on one shift even though it’s designed for two shifts. The company tied the closure to a “reconfiguration” of its coastal operations, saying it wanted to sell the real estate and “repatriate” working capital.

But Al Bieksa, president of the United Steelworkers Local 2009, accused the company of doing the opposite of repatriation.

“They took advantage of the fact they could sell this land,” he said. “We know what they’re going to do with that money; they’re going to invest it back in the states.”

Interfor has said it is investing in its Canadian operations, for instance, by adding “dry kiln” to a mill in the Interior.

But the Vancouver-based company now produces more wood in the U.S. south than anywhere else and its multiyear strategic plan focuses on $240 million in investments there.

Given the flight of capital, Bieksa said he wants a jobs commissioner with the authority to stop mill closures under certain circumstances.

The clash against the largest companies is intricately tied to the way B.C.’s forestry sector evolved. Under a decades-old system, companies control licences, known as tenures, to harvest timber from public land.

Originally, the government granted tenures to companies under the premise that the wood be processed at a local mill. But in 2003, during a bust cycle, the province removed those conditions and allowed companies to buy and sell tenures.

With B.C.’s timber supply projected to shrink 14 per cent over the next five years, many companies are closing mills and making deals to sell tenures as part of an industry-wide consolidation.

But as communities and unions watch the job losses mount, they also note that these companies are still harvesting trees from public lands.

“Basically, five big companies own most of the harvesting rights in British Columbia, and they’re not investing in B.C.,” Bieksa said.

Earlier this year, the B.C. legislature passed Bill 22, allowing Minister of Forestry Doug Donaldson to reject any tenure transfer if he finds it doesn’t support the public interest.



One transfer under review concerns Canfor, which closed its mill in Vavenby and arranged in June to sell its tenure for $60 million to Interfor, which plans to haul the wood to a mill about 120 kilometres away. Five months later, the deal still hasn’t closed amid strong local opposition.

“I find it highly offensive almost that this is a cash deal,” said Merlin Blackwell, Mayor of Clearwater, which is next to Vavenby, “that somebody’s going to benefit from something that was gifted away by the government.”

Last week, Chief Shelly Loring of Simpcw First Nations, whose territory overlaps with the tenure land in question, said in a press release that she was close to finalizing a deal with Canfor and Interfor that would protect against “the monopolization of forest resources.” But she said the deal is not economically viable without support from the province.

Donaldson, a former councillor in Hazelton, a remote community with a shrinking forestry sector, said there’s a lot of anger that the government is not managing timber “first and foremost” for communities’ benefit.

“I find that sentiment widespread throughout the province,” he said.

The minister declined to comment on how he would rule on the Vavenby tenure transfer, but said Bill 22 “is not a mechanism for the government to redistribute tenure.”

Since Bill 22’s passage, Donaldson has approved just one tenure transfer: in October, Conifex Timber Inc. sold a tenure to Hampton Lumber for $39 million. He passed along a letter sent to a local First Nations chief that stated the government required Hampton to build a mill in Fort St. James within 36 months as a condition of the transfer.

It’s not clear how much more the province is willing to do to help the forestry sector. In August, the government announced a $69-million package that provides early retirement incentives, temporary funding for fire prevention jobs and skills training for forestry sector workers.

Canuel and Bieksa also said the formula the formula that the province uses to determine the fair market value of timber on its land, known as stumpage, which has risen steadily since 2009, is not responsive to the market: when lumber prices are high, stumpage rates are low, and vice versa.

Donaldson said he didn’t want to tinker with stumpage rates to avoid any risk of further enflaming a dispute with the U.S., which is claiming in front of the World Trade Organization that Canada subsidizes its softwood lumber market.

“Anything that could be construed as a political intervention into stumpage would make matters worse at this sensitive time,” he said.

Still, there are changes afoot.

In October, the B.C. Legislature introduced Bill 41 to implement the United NationsDeclaration on the Rights of Indigenous People. If passed, it could create a framework for recognizing First Nations’ legal rights, including their claims to traditional territory, which could change where timber is harvested.

Clearwater Mayor Blackwell predicted the bill would pressure the government to pony up money for First Nations, such as Simpcw, to purchase part of the tenures being transferred.

Blackwell said he would support anything to help the forestry sector in Clearwater, a town of about 2,200 people located five hours from Vancouver that wants to diversify its economy, but is having trouble doing so.

“We have entire subdivisions within the town that don’t have any internet at all,” he said.

Gary Bull, a forestry economist at the University of British Columbia, said the sector is transitioning.

Climate change has played a role in the industry’s woes to this point, as scientists believe the mountain pine beetle population exploded because of unseasonably warm winters, and all the dead wood the bugs left behind made recent forest fires even worse.

But as governments seek to decarbonize the economy, Bull said there will be opportunities to use trees to make recyclable packaging and mass-timber buildings as well as energy.

As the timber supply shrinks, he said companies will need to look to this bio-economy to add value to the wood.

“I think (the industry) is in the middle of an existential crisis,” said Bull. “It’s like a midlife crisis: think of someone who just got divorced, wants a really hot sports car and then is like, ‘What the hell am I doing?’ I think that’s where we’re at.”

business.financialpost.com/commodities/agriculture/west-of-the-oilsands-a-sector-suffers-its-own-existential-crisis-in-silence
 
MHz
#2
Perhaps it was overvalued in the few years the place was it's busiest. That is usually when the most pollution takes place. Just cleaning up the pollution that exists could keep the out of work people busy for many decades. No profit for the foreign investors so fuk all will get done, except the bitching and moaning.
 
Danbones
+2
#3
Looks like we are headed into a world wide crash of everything except debt, corruption and fakenews.
 
petros
+4
#4  Top Rated Post
I know it sucks Mo but it's cheaper to harvest prairie boreal.

A house in BC is framed and sheeted with spruce and OSB from SK or AB these days. They only use fir for the floor joists. Plywood is long gone.
 
petros
+2
#5
Quote: Originally Posted by MHz View Post

Perhaps it was overvalued in the few years the place was it's busiest. That is usually when the most pollution takes place. Just cleaning up the pollution that exists could keep the out of work people busy for many decades. No profit for the foreign investors so fuk all will get done, except the bitching and moaning.

Sawmill pollution? Such as?
 
Mowich
+4
#6
Quote: Originally Posted by petros View Post

I know it sucks Mo but it's cheaper to harvest prairie boreal.

A house in BC is framed and sheeted with spruce and OSB from SK or AB these days. They only use fir for the floor joists. Plywood is long gone.


What really sucks, pete is that the fall-out isn't just the loss of jobs in the mills. All areas of society are affected. Where are the small towns that relied on the taxes from the mills going to find another source of income? What is going to happen to all the businesses that will now go begging for customers. If families decide to move away what will happen to the schools and hospitals when they see their funding cut due to smaller populations? New jobs are not going to appear overnight as some seem to think. In the meantime thousands of BC families are suffering and if the BC government or the Feds give a shit it sure isn't apparent.
 
Danbones
+3
#7
They plan to drop the peeps as low as the lowest peeps out there.

Agenda 2030

Just wait till China or the US goes with a gold backed digital blockchain crypto currency, Trudeau sold ALL our gold, so we will be naked wearing nothing but paper to whoever wants to rape us for our resources.

Just another little potatoe famine...

My little oracle says the homeless thing is going to get worse, much worse, around here over the next few years.
 
taxslave
+3
#8
Quote: Originally Posted by Mowich View Post

What really sucks, pete is that the fall-out isn't just the loss of jobs in the mills. All areas of society are affected. Where are the small towns that relied on the taxes from the mills going to find another source of income? What is going to happen to all the businesses that will now go begging for customers. If families decide to move away what will happen to the schools and hospitals when they see their funding cut due to smaller populations? New jobs are not going to appear overnight as some seem to think. In the meantime thousands of BC families are suffering and if the BC government or the Feds give a shit it sure isn't apparent.

This is probably the good news. Citiots have no idea how much they are affected by the ups and downs in resource industries and this might just be their awakening.
WE as a group have managed to kill the goose that laid the golden egg with our collective greed and stupidity.
Big foreign controlled companies and pension funds with their quest for ever larger quarterly profits have no concern for the communities and little for the future of their industries.
Unions with their incessant demands for more money and bennies. Lets face it 7 weeks paid vacation is not affordable. It almost requires an extra 50% more employees. All of whom get said bennies.
Multiple levels of government with taxing authority that have milked the cash cow dry.
Governments again with expensive and often unnecessary rules, both environmental and regulatory. This includes multiple departments of multiple levels of government demanding reports on items not in their mandate but because they have to justify their own growth. We will include a stumpage policy not related to end product price here.
An out of touch society combined with vote oriented politicians that have removed huge swaths of prime timber from the working forest for other purposes including such stupid things as visual quality objectives.
A land claims industry that has caused uncertainty for investors.
 
taxslave
+1
#9
Quote: Originally Posted by petros View Post

Sawmill pollution? Such as?

Noise and dust.
 
Mowich
+2
#10
Quote: Originally Posted by taxslave View Post

This is probably the good news. Citiots have no idea how much they are affected by the ups and downs in resource industries and this might just be their awakening.
WE as a group have managed to kill the goose that laid the golden egg with our collective greed and stupidity.
Big foreign controlled companies and pension funds with their quest for ever larger quarterly profits have no concern for the communities and little for the future of their industries.
Unions with their incessant demands for more money and bennies. Lets face it 7 weeks paid vacation is not affordable. It almost requires an extra 50% more employees. All of whom get said bennies.
Multiple levels of government with taxing authority that have milked the cash cow dry.
Governments again with expensive and often unnecessary rules, both environmental and regulatory. This includes multiple departments of multiple levels of government demanding reports on items not in their mandate but because they have to justify their own growth. We will include a stumpage policy not related to end product price here.
An out of touch society combined with vote oriented politicians that have removed huge swaths of prime timber from the working forest for other purposes including such stupid things as visual quality objectives.
A land claims industry that has caused uncertainty for investors.


I highly doubt citiots will give a shit, ts. The majority of them have no understanding of rural communities or they would shown some interest long ago. I do agree with the rest of your post.
 
Mowich
+3
#11
British Columbia’s Declining Forestry Industry is Bad News for the Environment

For decades, British Columbia (B.C.) has prospered from a high demand for lumber. The province is home to an expansive temperate rainforest, the logging and harvesting of which enables the forestry industry to employ thousands of people with, until recently, a high degree of job security. However, the amount of merchantable logs in the province is declining due to a slew of natural disasters, and trade disputes with the United States over tariffs on softwood lumber have increased the cost of exporting lumber. These factors have resulted in a steady decline of the forestry industry that began in the late 1990s, but has experienced particularly sharp downturns in 2005 and 2018, affecting the livelihoods of thousands of British Columbians. The forestry industry also plays a significant role in the preservation of B.C.’s forests, and its decline therefore poses a severe risk not only for the province’s economy, but its environmental sustainability as well.

Impacts of the Decline of the Forestry Industry

Approximately 32,000 jobs have been lost in the province’s lumber sector between 2003 and 2016. In recent years, B.C. has been the site of multiple record-breaking wildfire seasons and beetle infestations, reducing the number of trees that can be logged. This has left companies scrambling to devise alternative solutions so as to continue making a profit. However, these solutions constituted the termination of employment for thousands of people, primarily in areas where forestry is the main source of household income. While companies have been able to keep their profit margins viable, it is at the cost of almost a thousand jobs per year. These job cuts endanger not only livelihoods but forests as well, the latter of which is currently managed by a strict regulatory regime that enforces sustainable practices and corporate responsibility. B.C.’s licensing regime mandates that forestry companies, and by extension their employees, are responsible for maintaining the health of harvested areas. For example, loggers—often the personnel closest to initial wildfire sites—are legally required to abate potential fire hazards so as to quickly address fires before they spread.

As more surveyors and loggers become unemployed, many wildfires are left to spread across larger areas, creating a much greater problem that requires more time and resources to address. This was the case in 2018, when the province saw over 1,000,000 hectares of land burned during a severe fire season, a 93% increase from two years prior and an 80% increase from the decade’s average. With increasing unemployment in the forestry industry, the next fire season could be even worse than in 2018 when the province declared a state of emergency. During this season, thousands were forced to flee their homes and logging was virtually impossible, effectively stalling the industry in the province for the duration of the summer.

Additionally, the industry is still feeling the effects of a major mountain pine beetle infestation in the late 1990s that killed approximately 50% of all pine trees in British Columbia. While the invasion peaked in 2004, the end of the salvaging period has severely crippled lumber mills in the Interior. “For the past two decades, foresters have been able to salvage healthy pine and clear out dead trees to make room for replanting,” noted Jonathan Armstrong, the General Manager of Timberlands Planning at Western Forest Products, a major lumber company in B.C. “But now, the salvaging period is ending, and the mills don’t have anymore wood to process.

While the pine beetle primarily affected forests in the Interior, mills on the coast are also facing external problems: since 1982, Canada and the United States have disputed trade agreements relating to the export of softwood lumber from British Columbia. Currently, the tariffs to export softwood lumber into the U.S. from Canada are 20%, making the cost of exporting the lumber more than its actual value. So, while coastal mills rely on the sale of softwood, it is no longer profitable to produce, thus resulting in the closures of dozens of mills.

These closures undoubtedly have a major impact on B.C.’s economy. Approximately 150,000 people are employed in forestry and lumber in the province with most working in small businesses with less than 20 employees. Forestry also directly supports B.C.’s transportation industry, as approximately 14 million metric tonnes of forestry cargo pass through B.C. ports each year. For many towns, primarily those in rural areas or on Vancouver Island, mill closures can be devastating. These towns are largely dependent on the forestry industry, with most of their residents employed at one of the mills. With its closure, residents are often unable to sell their houses and are forced to leave their communities en masse to find employment elsewhere.

Environmentalist Influence in B.C.

Evidently, the lumber industry has substantial influence in British Columbia, and as a result, forestry-based environmentalism does as well. While climbing temperatures have inspired the rise of a global environmentalist movement calling for more sustainable practices, environmentalism in B.C. has been prevalent since the early 1900s, when loggers advocated for increased regulation of logging operations. In 1993, B.C. became the site of the infamous “War in the Woods”, where 11 000 people protested the logging of old-growth forests in the Clayoquot Sound. The demonstrations arose after local First Nations’ and environmentalist organizations’ concerns about the scale of logging operations were largely ignored by forestry company Macmillan-Bloedel. It remains the largest incident of civil disobedience in Canadian history and continues to serve as inspiration for British Columbian environmentalists.

In 2016, environmentalists forged an agreement between forestry companies, the provincial government, and First Nation communities to introduce the Great Bear Rainforest Land Use Order and the Great Bear Rainforest Management Act to enact efforts aimed at conserving 85% of the Great Bear Rainforest and bar its old-growth trees from future harvesting. Furthermore, the most recent provincial election in 2017 resulted in a coalition between the New Democratic Party and the Green Party, giving an unprecedented amount of influence to environmental interest groups. It is easy to understand why environmentalism is such a prominent force in B.C.: much of the esteem of the province comes from its natural beauty, particularly from its unique temperate rainforest, and the residents of B.C have shown they will take action against foresters to protect it.

Sustainable and Reconciliatory Standards

However, environmental interests and practices employed by forestry companies are not always in conflict. As 95% of B.C.’s forests are publicly owned, the provincial and federal governments are able to enforce the use of sustainable practices so that logging companies ensure continued prosperity in harvested areas. These laws, specifically the Forest and Range Practices Act (FRPA), obligate any license-carrying forestry company to fulfill certain sustainability requirements. For example, licensees must replant trees in the same area as those they harvested, and are then liable for the health of the new trees until they reach maturity. While these regulations assure that foresters are legally responsible for reforestation in B.C., forestry companies have been employing sustainable harvesting practices since before the creation of FRPA in 2002. These efforts are not entirely driven by environmental concerns, but rather economic ones: forestry relies on trees being a renewable resource, and sustainable harvesting methods allow the industry to continue producing lumber in previously harvested areas.

Since the 1930s, approximately 7.5 billion seedlings have been planted by forestry companies in areas affected by logging, wildfire, or insect infestations. While many environmental campaigns encourage individuals to plant a few dozen trees, foresters plant hundreds of thousands each year, so that about 80% of all harvested trees are replanted. Furthermore, forestry companies were largely responsible for cleaning up the damage left by the mountain pine beetle infestation. The salvaging of the healthy trees and the removal of dead ones not only reduced the chances of a wildfire breaking out, but also removed many barriers for wildlife and enabled the growth of new forests: “The salvaging operations [conducted by forestry companies] definitely did benefit the environment. Where you would have seen dead trees, there are now healthy, growing forests,” said Armstrong.

Addressing the Decline

The B.C. forestry industry was once proof that natural resource-based industries can turn a profit and serve to protect the environment, as long as they adhere to sustainable practices. However, decreasing demand for lumber and increasing costs to produce it may serve to invalidate the benefits of sustainability-driven forestry practices in the modern era. Fortunately, there are potential solutions: if the Canada-U.S. softwood lumber dispute is resolved, forestry companies will be able to re-employ thousands of people who lost their jobs due to the need to cut costs.

Furthermore, the provincial government is in a crucial position to not only revitalize the forestry industry, but encourage innovation: “[To address the decline,] the government can create an environment where businesses are able to innovate and develop new, better forest management practices,” said Armstrong. While this freedom would need to be balanced with existing regulations, Armstrong believes that offering companies the opportunity to approach environmental objectives their own way will result in job creation and better sustainability practices, giving the industry more flexibility as the industry adapts to environmental changes in B.C., such as potential wildfires or insect infestations. However, formulating these practices is impossible without collaboration between forestry companies and environmentalists.

While the existing regime did succeed in enforcing environmental standards, much to the delight of B.C. environmentalists, it was primarily through oversight and detailed practice-based regulations. According to Armstrong, if regulations are rewritten to be more result-oriented instead, this would inspire foresters to collaborate with advocacy groups to innovate practices that are both sustainable and efficient. In B.C., it appears that the best way to simultaneously address a falling industry and major environmental issues is by fostering cooperation between two influential sectors in order to create practices that satisfy and benefit both groups.

“You can’t ignore these problems,” said Armstrong. “But, at the end of the day, when [environmentalists and foresters] get together, talk about these things, and work things out, that’s how we help these situations.”

www.mironline.ca/british-columbias-declining-forestry-industry-is-bad-news-for-the-environment/
 
petros
+1
#12
Quote: Originally Posted by Mowich View Post

What really sucks, pete is that the fall-out isn't just the loss of jobs in the mills. All areas of society are affected. Where are the small towns that relied on the taxes from the mills going to find another source of income? What is going to happen to all the businesses that will now go begging for customers. If families decide to move away what will happen to the schools and hospitals when they see their funding cut due to smaller populations? New jobs are not going to appear overnight as some seem to think. In the meantime thousands of BC families are suffering and if the BC government or the Feds give a shit it sure isn't apparent.

Green jobs. It's the solution to all cash woes.