B.C.’s forestry communities are fed up and frustrated with the industry’s ups and downs—and loss of jobs

By Jim Stirling

Residents and forest industry workers in British Columbia are fed up and frustrated with suffering the consequences of someone else always pulling the emotional and economic yo-yo strings.

Take Mackenzie, for example, a forest industry dependent community in north central B.C. Its people have endured more ups and downs in the last few years than should be experienced by any one place. They’ve lost jobs and futures as the town’s three major forest industry employers have been alternatively shut down, experienced lengthy closures and been subjected to unrelenting uncertainty. Reasons for the extended misery include shortages of suitable commodity lumber wood sources, erratic markets, high production costs and political interference.

B.C. Premier John Horgan helped establish a timber supply table in Mackenzie. The idea was to get the community, the forest industry, labour and indigenous leaders together to try and hammer out a practical direction forward for the community.

It hasn’t happened and it’s not surprising. Small towns alone can’t solve issues surrounding an evolving world forest economy way beyond their influence. Large licencees active in B.C. have long since recognized fundamental changes happening within their traditional operating areas. Consequently, they’ve plotted new courses aimed to sustain their growth.

Canfor Corp, a large integrated forest company active in central and northern B.C., provides an example of diversifying its operations to adapt to change. It’s expanded the scope of its industrial activities to help it maintain its prominent position in an increasingly volatile forest industry environment. It helps explain why more than 30 per cent of the company’s production capacity is now in the southern pine belt of the U.S. A further 22 per cent is in Sweden. Canfor’s Scandinavian assets were augmented in June when its subsidiary acquired three more Swedish sawmills for $43 million.

It wasn’t long ago that Russia was dismissed as a serious competitor for Canadian lumber products. Yes, said the experts of the day, the country has vast untouched forest reserves but it lacked the infrastructure to fully exploit them and its development was further hindered by the influence of selfish oligarchs. But Russia has now firmly established itself as a low cost lumber producer and supplier of raw logs to be reckoned with by the traditional North American and European manufacturers.

And there’s much more to come. Construction work was ramping up this past summer on what is destined to become one of the largest and most sophisticated sawmills in the world. The ULK Group’s new complex in Russia’s Archangelsk area will have an annual lumber capacity of a million cubic metres and produce 600,000 tonnes of industrial wood pellets each year when completed in 2023.

Back in Mackenzie, many locals are increasingly upset by the volumes of wood leaving adjacent forests for processing in points south. They want at least some of it processed in Mackenzie, into both lumber and other wood products.

The timber supply table in Mackenzie can’t do much about that either. But Premier Horgan could do something if he has the appetite to take on a contentious issue.

“I reminded the forest companies that, by and large, the forests that they work in are not theirs,” Premier Horgan told Vancouver Sun columnist Vaughn Palmer recently. “They’re public forests. They (forest companies) have tenure arrangements, contracts with the people of B.C. to harvest that wood. Those contracts, historically, have meant there’s to be a benefit to communities.”

Forest companies like Canfor aren’t doing anything wrong. The previous Liberal provincial government changed the rules to allow licencees to process wood originating from their assigned cutting areas in sawmills most advantageous to them. Canfor and other forest companies have and are simply exercising that right. They’d be reluctant to relinquish that flexibility without a quid pro quo. The social licence inherent with a publicly owned resource might specify where wood should be processed relative to its point of origin and would need a change back in tenure rules. If that is Premier Horgan’s wish, his plans would be enhanced by receiving a majority government in the upcoming provincial election, rather than relying on the tenuous-on-paper agreement he had with B.C.’s Green Party.

If Premier Horgan were to instruct senior forest ministry staff to re-examine parts of the B.C. tenure system to better address the social contract issues he might also be inclined to reinforce the forest industry’s competitive foundation in the province. He could do that by breaking some more new ground in B.C.

“A key that would help build the confidence that drives investment into the province would be to settle on the size of our working forest and lock it in. This would allow companies and communities to plan a future that workers can count on,” recommends the B.C. Council of Forest Industries (COFI).

The suggestion was part of a lengthy suite of proposals put forward by COFI in 2019. The recommendations were contained in the COFI document “Smart Future: A path forward for B.C.’s forest industry.”

The premise is the working forest in B.C. needs to be defined and protected. Only by so doing, argues COFI, can the provincial forests be most appropriately managed to meet the challenges of a changing industry. At the same time, the establishment of a working forest land base would help restore confidence and investment, to maintain a sustainable future for the forest industry in B.C.