Ever since US house prices peaked in mid 2006 and the great economic slump began south of the border, BC’s government and forest industry alike have been understandably anxious.
Dependent as we have been on the US market for billions of dollars in forest product purchases, BC naturally yearned to open up new markets.
Given its spectacular economic growth, China became the focus, and before long BC’s marketing efforts yielded gains in both the volume and dollar value of forest products exported.
But on closer inspection, BC’s China foray may offer considerably less promise than hoped (at least if current trends prevail). The problem is that the province’s focus has been on market diversification as opposed to product diversification.
What we’re shipping to China remains primarily non-processed commodities. Our China exports include shiploads of raw logs and low-value lumber products, and lack high, made-in-BC value.
They also lack distinction, meaning that if China turns off the tap, BC will be left to compete in global markets with products that are readily substituted. In the short-term, this may prop up an industry that has lost ground in its historically most important market, but in the medium and long term it will not take BC, its forest industry, or the many communities dependent on that industry to a better place.
Diversifying and upping the value of what we make remains the best hope BC has to put the industry on more solid footing. It’s also central to any credible plan to restore the health of our forests and to use both our forests and forest products to maximize carbon storage, one of the great natural tools at our disposal to address climate change. Higher value wood products hold the carbon that the trees they are derived from once held and they can do so for generations.
The good news is that BC has ample opportunity to move up the value chain.
In Ontario and Quebec – two provinces with significantly smaller annual log harvests than BC – the sales value of higher-value wood products in 2010 was, respectively, $928 million and $825 million. BC, by comparison, managed just $345 million. For every 205 cubic metres and 298 cubic metres of wood used respectively by Ontario and Quebec to generate one full-time forest industry job, BC required 1,189 cubic metres to accomplish the same feat (one cubic metre equals one telephone pole).
Clearly, BC’s approach will achieve neither a sustainable forest industry nor healthy sustainable forests, both of which are worthy objectives that quite properly are linked. Without the latter there is no former.
One of the best hopes of improving the health of BC’s forests and its forest industry is to ensure greater social and economic benefits from the utilization of fewer raw resources. You can’t make forest products if you don’t have healthy numbers of healthy trees. Yet in BC such trees are becoming a premium, thanks in no small part to the monumental mountain pine beetle outbreak in the interior of the province and all of the escalated logging activities that took place in response to it in the first half of the last decade.
So in thinking about doing things differently, what realistically might we focus our efforts on and what could be the results?
Well why not begin by focusing on raw log exports. Even using BC’s relatively poor job generation poor unit of wood, we could add another 2,630 manufacturing jobs to our forest industry just by requiring that logs currently shipped to China and elsewhere were, instead, manufactured in BC.
Then we could turn to the profligate waste of usable logs at logging sites across the province – wasted logs that are eventually pushed into piles and burned releasing copious, and completely unnecessary greenhouse gases into the atmosphere. Again, based on current employment rates, we could create another 2,400 jobs by working with that wood, which would take pressure off of logging forests prematurely.
Third, we could immediately invest in increased, publicly funded reforestation efforts as governments on both the left and right ends of the political spectrum did in decades past. At a modest investment of $100 million per year, we could renew our forests with an additional 91 million new trees per year, providing an additional 5,200 tree planters and tree nursery workers with good seasonal jobs.
And finally we could require legislated minimum levels of investment in new and existing mills as a condition of logging companies retaining access to public forests – something that could, over time, catalyze another 10,000 or more jobs in the province’s moribund value-added sector.
Even that wouldn’t catch BC up to Ontario and Quebec. But it would be a good step toward a healthier, more diversified, carbon-friendly industry.
Ben Parfitt is resource policy analyst with the BC Office of the Canadian Centre for Policy Alternatives and author of Making the Case for a Carbon Focus and Green Jobs in BC’s Forest Industry, released today by the CCPA. This report is part of the Climate Justice Project, a five-year research project led by CCPA-BC and the University of BC.