Kevin Mason
The North American lumber market broke out of its winter slump this month, with prices for several species and dimensions appearing to finally find a near-term floor around mid-month. Southern Yellow Pine (SYP) remains the standout performer—2×4 prices started trending higher at the beginning of the year and have scarcely let up since (SYP has traded at an unusually large premium to S-P-F through the first four months of the year). …However, we note that S-P-F prices are still far below cash-cost levels for BC sawmills and believe a huge volume of unannounced sawmill downtime is being taken in the province.
…In mid-April we attended the Council of Forest Industries’ annual convention in Prince George, BC, and left with more questions than answers about the state of the industry in the province. Clearly, the BC forest products sector is in a difficult place right now: BC is the highest-cost producing region for most of the products it makes; S-P-F lumber prices are hovering near multi-year lows; pulp prices are in freefall; and mill-closure announcements (both pulp and lumber) are coming thick and fast. There are myriad forest policy initiatives being laid out by the provincial government (i.e., old-growth protection, tenure reallocation, habitat conservation, etc.), but, in trying to be all things to all people, we fear the government is getting in its own way. …Canfor’s upcoming decision about whether to invest in a rebuild/modernization at its Houston, BC sawmill will be an interesting litmus test for both the government’s and the industry’s commitment to the province.
From timber long houses in Europe to temples in Asia, wood has been a primary construction material in buildings since the Stone Age, with some still standing more than a thousand years later. Today, modern technology and engineering is turning wood into a “new” building material, mass timber, which is set to transform the North American lumber industry. …For decades, Europe has been at the forefront of this revolution, but growing momentum in the still-nascent North American market is fostering an environment ripe for commercial opportunities. …The number of North American mass timber plants has grown to 22 from just 4 in 2016, and that number could more than double by 2027… and there are many opportunities to participate in different parts of the business. These include fabrication of and design services for the various components and connections, all the way to working with architects and engineers on fully integrated design and supply solutions.
This presents the opportunity for both the lumber and pulp industries to co-operate on land management, sharing in the carbon offset credit revenue to help pay for the establishment of the plantation, while benefiting from additional fibre sources over a shorter time span. …There is plenty of room in Canada for both conventional crop farming and tree farming. The key is to plan strategically and aim, for example, at productive land parcels that are difficult to farm but could still generate income through the sale of carbon offset credits. Parcels as small as one hectare could still be monetized into a valuable tree farm. …If Canada wants to achieve its GHG reduction targets, it’s going to have to do a lot more than just pump carbon dioxide back into the ground… and making tree farming affordable goes a long way toward building a natural climate change solution.
One of my biggest pet peeves is the misguided expectations that come from using the number of jobs per thousand cubic metres of timber harvested to compare British Columbia’s forest sector to other jurisdictions. Critics have attempted to associate BC’s comparatively low generation of jobs per thousand cubic metres harvested to issues such as log exports, mechanization, forest management practices and minimal value-added processing. …BC is often compared to Quebec and Ontario, which have much higher jobs per thousand cubic metres harvested. …Jobs per thousand cubic metres of timber harvested is a relative metric useful for comparison to other regions, but it does not tell the behind-the-scenes story. 
North American lumber markets continue to strengthen from ongoing logistical problems and supply chain woes. …SPF mills in BC continue to face railcar shortages… and now the Russia- Ukraine invasion threatens lumber exports from the world’s largest exporter. This event will only tighten up the world’s lumber supplies and push prices even higher, especially in Europe. …US lumber and panel demand continues to advance, spurred on by COVID-19 constraints and steady demand for new homes. US housing starts continue to move higher and reached 1.597 million units in 2021, a 15.8 per cent increase from 2020. However, a slower rate of new house construction is forecast for 2022 (+3 to 5 per cent) as builders simply cannot build houses fast enough. …US repair and remodelling activity accounts for 40 per cent of US lumber consumption and it is expected to increase significantly again in 2022. 
Over the last few months, the BC forest sector has increasingly been the beneficiary of broad proclamations by many who work outside of the sector about an upcoming “paradigm shift” and “transformative future” in the management of BC’s forests. For some, these are apparently new and wise revelations worthy of our everlasting gratitude. The reality is that many of us have been around long enough to know that for decades, these terms have been bandied around repeatedly when each generation believes they have found the grand solution to the forestry issues of the day. These many decades have also seen the ebb and flow of the lobbying influence each faction in the debates can harness for their agendas dependent upon the government’s leanings in any particular election cycle. Today, many would say the pendulum is weighted towards environmental influences, while others will argue the industry’s influences were dominant in previous times. There is probably merit on both sides of the argument.
There are many times when I’ve been frustrated by the headlines sensationalizing protests about forest management in BC. The relentlessness of the attacks on our forest sector becomes, right or wrong, numbing. …I’m not talking about the legal and passionate protests and dialogue about the future of forest management in BC. This is about those that flout the law, discourage real discussion, discourage democracy, and have a new brand of colonialism. One protest group dumped a pile of manure at the front door of Premier Horgan’s constituency office. Wow, that is really mature. Next, Minister Conroy’s home phone number was published online and both she and her family members received threatening messages. Wow, what kind of person does that?
Last year BC exported over $16.3 billion of forest products… But will BC forestry and the workers, communities, First Nations and professionals in this sector continue to be a robust part of our economy as it has been for more than a century? The NDP government recently tabled ideologically-driven plans to damage the forest sector, perhaps irreparably. Their plans needs a sober second look and major rethink. These radical, unprecedented proposals were dropped on rural BC communities, forest workers, unions, forest professionals, First Nations, the forestry industry and 10,000 BC businesses supported by forestry. In my 50 years’ experience working in our forests, it’s hard to fathom why so little consultation was done with those most affected.
