Canada's softwood lumber negotiating strategy is hurting, not helping, forestry workers

By Tony Kryzanowski

The Canadian Press news agency recently published an interesting profile of a forestry worker from Mackenzie, B.C., Rachelle Dumoulin, who has been laid off twice in the past seven years at two different sawmills. She has decided to leave the industry—not a big surprise, really, but hardly a positive indicator of the labour situation in the Canadian forest industry.

Check out any industry website and discover how challenging it is to attract skilled labourers like millwrights and electricians, particularly to remote areas.

The flawed Canadian negotiation strategy to gain financially favorable softwood lumber access to the United States may have something to do with experienced, skilled labor leaving the industry. It has proven to be too risky for them to make a commitment to move their entire families, often to remote communities, only to find themselves laid off because of a poor softwood lumber negotiating strategy that constantly puts their jobs at risk.

According to the same Canadian Press report, nearly 6,000 workers have been laid off at 25 facilities in 22 communities in B.C. alone this year.

The prospect of actual negotiations toward a new Softwood Lumber Agreement seems more likely now since the NAFTA Chapter 19 binational panel recently concluded that there are insufficient grounds for the U.S. International Trade Commission to claim that Canadian softwood lumber products have materially injured the U.S. softwood lumber industry.

The U.S. has been given three months to reconsider its duties on Canadian softwood lumber as a result of this ruling, which means an announcement by the U.S. International Trade Commission, probably in December. It is worth noting that Canada also has an appeal before the World Trade Organization (WTO) disputing current duties.

Ho hum, right? Canada wins again. That attitude is not only dangerous, but also unsustainable and unfair to workers.

It seems that the Canadian strategy is to simply go along with the duties and then file complaints with both NAFTA and the WTO, with the belief that we have a winning hand, and that we have a strong chance of winning all the time. After all, a lot of that duty money was returned after the last softwood lumber trade dispute between 2001 and 2006.

A new Softwood Lumber Agreement was signed in 2006 and lasted nine years. It also resulted in the return of more than $5 billion in duty deposits by U.S. authorities to Canadian companies. We won. Yeah!

But what happens if we don’t win, even one time? This is the big gamble that Canadian negotiators and companies are taking. The question is whether taking this approach is a good and fair bet for Canadian forestry workers looking for long term employment. It’s not, and we are already seeing the consequences of a combination of a U.S. housing downturn and duties with closures and curtailments at sawmills and panel board plants from coast to coast.

While negotiators play chicken and take years to resolve these softwood lumber disputes on a seasonal basis, real people with real mortgages, real school fees, and real pick-up truck payments are getting hurt.

It’s time for Canadian negotiators and politicians to stop gambling with the lives of ordinary Canadian workers, and change the playbook, and seek a permanent solution. In fact, workers should demand it.

One solution might be to include softwood lumber in the NAFTA agreement, instead of as a side agreement with the United States. If we can negotiate a trade agreement between ourselves on such contentious issues as the auto industry and dairy in NAFTA, there is no reason why softwood lumber can’t be included—and it should be.

There is always the danger that we will lose one of these current appeals, and once the Americans win and slap on duties, chances are that they will never come off. Watch the mill closures and job losses then.

Having covered this industry for 30 years, what’s most concerning is not only the danger of this negotiating method, but also the casualness that politicians, negotiators and forest company management take to this negotiating dance. During the recent negotiations with the Americans on NAFTA, one Canadian politician was quoted as saying that softwood lumber would have to take a back seat for now—because while the Canadian forest industry generates $14 billion in lumber sales to the United States annually, NAFTA generates $14 billion in sales every two weeks. In other words, during the NAFTA negotiations, it was a lower priority. But NAFTA was settled months ago. What’s happened since on softwood lumber?

Eastern Canadian softwood lumber producer EACOM Timber Corporation recently hosted a celebration in Timmins, recognizing their mill’s 100th anniversary in the community.

A statement in the local press by EACOM Communications Director Julie Paquet really sums up what facilities like this mean to local communities.

“The mill has been part of the community for a hundred years and just about everybody in town has some sort of connection with the mill,” she said.

So when Canadian politicians, negotiators, and companies adopt a casual and careless strategy of waiting it out and fighting the battle on softwood lumber at trade tribunals every five to 10 years—gambling that we’ll win every time—are they concerned about the workers being laid off right now, in communities where, ‘just about everybody has some sort of connection with the mill’?

It doesn’t seem like they care, if the numbers of recent layoffs is any indication.

When you come down to it, is it any wonder that the industry is having difficulty attracting skilled workers?

Logging and Sawmilling Journal
October 2019

On the Cover:
James and Susan Willis manage J.A. Willis Contracting with ambition, strict business acumen, with a focus on efficient and productive equipment and highly motivated operators—it’s a powerful formula. Part of their core equipment is a Tigercat 845 harvester James first started using in B.C.—and continues to use in the logging operation they now run in New Brunswick, which now has a staggering 70,000 hours on it. The Willis logging operation also includes some recently acquired equipment such as the new Peterbilt truck with BWS quad trailer pictured on the cover. Read all about the Willis operation beginning on page 18 of this issue (Cover photo by George Fullerton).

B.C. hard hit by mill closures, curtailments
British Columbia—particular the Interior of the province—has been hit hard by sawmill closures and curtailments, and it is having a definite, and big, ripple effect on the logging sector, says the new general manager of the Interior Logging Association, Todd Chamberlain.

First Nations keeping the wood flow happening
First Nations and Métis communities are playing a key role in keeping the wood flow happening at Tolko Industries’ OSB plant in High Prairie Alberta, with a First Nations corporation managing all the log yard activities at the operation.

Opting for off-species
New Brunswick’s Tony Boyd took a somewhat circuitous route to sawmilling, via the trades and logging, but he’s now established a solid business producing custom wood products from a variety of off-species in the region.

A logging package that delivers
James Willis has logged in the West and East, working with the same dependable, productive Tigercat 845 buncher, though these days he has a new Log Max 6000V head, and opted for the Rotobec continuous rotator, a package that delivers the goods.

Taking care of business
B.C.’s Homalco First Nation is looking to build up its forestry operations, to make optimum use of their logging equipment—and to continue to grow its business and provide jobs and training for the band’s members.

The Edge
Included in this edition of The Edge, Canada’s leading publication on research in the forest industry, are stories from Alberta Innovates, Canadian Wood Fibre Centre (CWFC) and FPInnovations.

The Last Word
Canada’s softwood lumber negotiating strategy is hurting, not helping, forestry workers, says Tony Kryzanowski.

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