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A strategic land use plan for the Queen Charlotte Islands could see licensees such as Western Forest Products and their logging contractors emerge as victims of collateral damage.

By Jim Stirling

There are two key factors to understand about the development of a strategic land use plan for the Queen Charlotte Islands between the Council of the Haida Nation (CHN) and British Columbia’s Liberal government: 1. The CHN will probably get pretty much everything it wants. 2. The CHN will probably get everything it wants.                                   

The government will accede to the CHN’s aspirations because the Haida are canny operators who are taking full advantage of the government’s willingness to bend over backwards to accommodate everything aboriginal in the province. Forest licensees and their logging contractors, however, emerge as potential victims of collateral damage. They may be forced to abandon their operations in the Queen Charlotte Islands altogether. The islands—Haida Gwaii—are an archipelago off BC’s northern coast where trees grow like crazy.                                   

Upsetting large licensees’ plans will not overly disturb the Haida. They’ve long decried what they perceive as short-term money-grabbing licensees creaming off island logs to southern mills for processing. The Haida has laid claim to all the islands’ natural resources: the land, the forests, the animals, the sea and whatever might lie beneath it. The proposed land use plan is an essential stepping stone toward the Haida achieving its goals.                                   

Some non-Haida groups are unhappy about the bilateral land use plan process. It has meant all other groups—including forest companies and local government— are left out in the cold. They will have to pick up the plan’s ramifications as best they can and try to find ways to live with it.                                   

The CHN didn’t get back to the Logging & Sawmilling Journal at the time of writing this. That’s unfortunate, but understandable, given the Haida’s desire to control the release of information until the plan is finalized.                                   

But some aspects appear clear. The finished land use agreement is likely to include a new raft of protected areas totalling at least 225,000 hectares. Many of these are in northwest Graham Island and along the westernmost fringes of Graham and Moresby islands. South Moresby—Gwaii Haanas—is already a wilderness national park reserve. It also appears the Haida and the government have agreed to an initial allowable annual cut of 800,000 cubic metres. The word initial is important.                 

The forest industry views a million cubic metres a year as a benchmark for economically viable operations. The existing AAC on the islands is 1.3 million cubic metres, though the average annual harvest levels since 2000 have been 1.12 million cubic metres                                      

A new land use agreement is also expected to mandate an ecosystem-based land management harvesting system. Forest companies fear that will simply add further strains to their cost burdens, perhaps to the point where they are no longer sustainable.                 

That point appears to have been reached by Edwards & Associates. The Surrey, BC-based logging contractor for Western Forest Products has filed for bankruptcy protection. The longterm island contractor which employed about 100 people cites several factors contributing to its dilemma. Most of them come down to delays and uncertainties caused by the protracted Haidagovernment land use plan discussions.                                   

Edwards & Associates crews couldn’t get access to the timber volumes they required to maintain efficient operations. Cutting permits and road development plans were stalled. Ownership transfers were a compounding factor for the contracting company. The original licence holder, MacMillan Bloedel, sold out to Weyerhaeuser in 1999. Cascadia then took a brief turn at the helm and now it’s Western Forest Products.                                   

All of those woes have been exacerbated by external factors like the record high Loonie, the collapsed US housing market, lumber export taxes and last summer’s coastal logging strike.                                   

The Teal-Jones Group is another logging and processing company acutely concerned about the outcome of the land use plan discussions on the Queen Charlotte Islands. The company says if the plan goes ahead as understood, it will cut harvesting levels for them by 49 per cent. That would leave the company with only 43,000 cubic metres of timber annually which would not be enough to sustain its logging operations out of Sandspit, where it’s a major employer. Husby Forest Products is another major logging contractor on the islands and it faces similar problems if the land use plan as proposed goes ahead. Protected lands have cut into its operating areas and its present 230,000 cubic metre AAC is down from 340,000 cubic metres. Husby estimates an overall harvesting level drop of up to 75 per cent and a cost increase of up to 25 per cent, attributable in part to conforming with an ecosystembased management harvesting system.                                   

Pat Bell, Agriculture and Lands Minister, has intimated the government may consider offering companies which suffer timber volume losses from the land use plan, alternate fibre sources elsewhere in BC. Wood devastated by the mountain pine beetle has been cited as a possibility.                                   

That’s hardly a viable alternative to companies with expertise and markets based on coastal logging. Nor is it any bargain. There’s a huge overcapacity in the BC Interior sawmilling sector. As inventories climb, mill owners are routinely ordering temporary shutdowns and shift curtailments. And something much more dramatic in terms of downtime seems inevitable before any life re-ignites the US dimension lumber market.                                   

The future of the other players on the islands awaits the final details of the land use agreement being made public and how much wriggle room the plan contains for revisions. Existing licensees have their backs to the wall. Their options are limited. They can try and make economic sense from the timber volumes available to them under the plan and handle the cost structures. But if they can’t, they will have little choice in the short term at least to leave the islands and try to retrench elsewhere.                                   

Another recent factor complicating matters is new proposed export fees on Crown timber to be introduced by the government on February 1, 2008. The fees have already drawn fire from the US lumber lobby. The Americans claim linking export fees to softwood lumber charges constitutes a violation of the Softwood Lumber Agreement between Canada and the US.                                   

Interestingly, a recent government order-in-council allows up to 35 per cent of the non-cedar harvest on the Queen Charlotte Islands to be exported. The allowance might tie in to the proposed land use plan for the islands.                                   

It could well be one of the objectives of the CHN strategy all along has been to dissuade other operators and acquire at least one forest licence of its own. The Haida can then more easily define its version of the pace and face of forestry on the islands.                                   

If and when that transpires, it will be fascinating to observe how the Haida go about stabilizing the island forest industry. They will have to balance sustaining forest land harvesting and resurrecting a shrinking economic base without the large scale exporting of logs.