One Year Later…

Coast Forest Products Association is working with government officials in Japan to incorporate results of a tremendously successful earthquake simulation test into the country’s stringent building code.

Visit the Coast Forest website for more information: www.coastforest.org

Coastal Forest Industry Supports HST

At a time when B.C.’s coastal forest industry is struggling to sustain itself through unprecedented economic hardship, the introduction of the Liberal Government’s harmonized sales tax comes as good news.

For years Coast Forest has been pushing for the introduction of a value-added tax like the HST. Why? Because “approximately 40% of the PST revenue collected by Victoria is paid by businesses on a wide variety of inputs used in producing goods and services,” according to the Business Council of BC. “Under the proposed HST, the provincial sales tax now paid on inputs is effectively eliminated, as the 7% provincial portion will be credited along with the 5% GST for all goods and services purchased for business operations.”

Other jurisdictions do not pay this tax, so, like many producers and manufacturers in the province, to remain competitive worldwide the forest industry has been unable to pass the current PST on to its customers, and it has cost the industry $140 million per year.

Remember, the forest industry along with the other major manufacturers and exporters in this province are the industries that generate the high paying jobs and wealth which support our quality of life. By government creating a level playing field, businesses are more able to invest and increase productivity, which means they’re more able to sustain those high paying jobs, so people continue to have the ability to buy homes and eat out at restaurants. In fact, consumers can expect to see the price of most goods and services fall as the PST disappears, a trend evidenced in other jurisdictions under the HST.

The premier understands the introduction of the HST will not be as easy for some industries as others, and is offering to help with the transition as businesses adapt to the new regime. But timing is everything. With Ontario’s introduction of the HST, that province automatically becomes more business friendly.  B.C. can ill afford to lose investment dollars that could subsequently flow east. This is a time when government and business need to work together to strengthen B.C.’s economy.

– R. M. (Rick) Jeffery, President & CEO, Coast Forest Products Association

Moving the Coastal Forest Industry Forward

Minister of Forests and Range, Honourable Pat Bell. Photo Credit: Government of British Columbia

Coast Forest Products Association congratulates the Honourable Pat Bell on his re-election as MLA of Prince George-Mackenzie and his reappointment as Minister of Forests and Range. The association looks forward to continuing to work with the minister and his staff to strengthen the relationship between industry and government, and build a strong and sustainable coastal forest industry.

B.C. Wood-frame Housing Rebuilding China

A demonstration house in the Guanzhuang Township used to train local builders on-site in the techniques of wood-frame construction.

One year after the devastating Sichuan earthquake the first wood-frame houses constructed of B.C. wood are now being completed in China.

This 124 square metre demonstration house is located in the Guanzhuang Township and was used to train local builders on-site in the techniques of wood-frame construction. Local builders, used to working with brick and concrete, are now recognizing the superior strength and earthquake resistance of wood-frame construction. For the first time ever B.C. lumber sales to China are rivaling those to Japan, partly due to historically low lumber prices, but also due to joint industry/government projects like these that are opening up markets for B.C. wood products in Asia.

Comparing the A and the A+ Student

In a province where forests are a major part of our collective identity, the more citizens that are aware of sustainable forest management (SFM) and marketplace tools like forest certification, the better off we all are. However, Christopher Pollan’s recent article in The Tyee (www.thetyee.ca) entitled “The War over Eco-Certified Wood”, leads readers to perceive conflict where none should exist.

While the article threads facts into the story, the overall picture is one of misguided negativity. As the CEO of the Coast Forest Products Association, I think the people of British Columbia have enough negativity on their hands right now with the biggest economic hit to the forest sector we’ve ever seen.

The article mentions the ad campaign SFI is running, which focuses on the fact that 90% of the world’s forests are uncertified. The ad promotes SFM, with a call to source products from certified forests and encourage responsible forest management. Calling SFI a “better than nothing” approach is shortsighted and is a slap in face to those who are on the ground doing right by our forests and our communities here in BC and on the coast.

Coast Forest’s members manufacture products from well-managed forests and compete with international producers that may be absent the legal forest management framework we have in BC, and may also not have independent certification. The fact that BC has the most certified area of any jurisdiction anywhere in the world is something we should be proud of. BC’s widespread adoption of independent certification sets the bar for the rest of the world, so I wholly agree with SFI’s approach – and the approach of many major forest product customers – of not wasting energy arguing over the A and A+ student.

With 90% of the world’s forests remaining uncertified, the fact is that most of the class isn’t doing well or isn’t showing up at all, and that is a globally significant problem.

I believe in inclusive procurement policies – policies that don’t limit a company in their efforts to meet their sustainability goals. We promote all three of the major systems used in BC and Canada – CSA, FSC, and SFI. And we are not alone – companies and governments around the world take an inclusive approach. For example, the UK’s independent Central Point for Expertise on Timber (CPET) has deemed all three systems as providing a legal and sustainable assurance for forest products. This rigorous independent assessment doesn’t see a war over certified wood.

On a final note, the article talks about the all-to-common occurrence of greenwashing. Influencers and governments across North America are addressing this issue – and both SFI and FSC are positively referenced in their independent reports (Terrachoice Environmental Marketing, and Canada’s Competition Bureau, among others.)  Mr. Pollon speaks of a “war over eco-certified wood.” Perhaps that war only exists in the minds of a few campaigning organizations and the certification system they exclusively endorse.

- Rick Jeffery, President & CEO

Moving Forward…

Now that the provincial election is behind us and hopefully the rhetoric has begun to fade away, attention is focused on the pressing economic issues that continue to face the coastal forest industry as the downturn in the U.S. housing market and the global financial crisis persist, challenging us to grow stronger or wither away.

With 50 per cent of coastal wood exports going south of the border and home construction activity in the U.S. expected to go on falling this year, it’s predicted the current economic crisis will continue. However, despite these challenges, forestry remains one of the three major economic drivers of this province along with mining and oil and gas.

This spring Coast Forest visited communities from Powell River to Campbell River to talk to local governments about these challenges and what the future holds for communities that depend on our industry. Today we are carrying on our work with the provincial government to build a stronger understanding of the forest products business across multiple levels of government. Together we are working to reduce costs, increase product value, boost productivity, shift production into emerging or promising markets and create hosting conditions to attract much needed investment.

The B.C. coastal forest industry’s challenge is to produce positive economic results so that it can continue to provide high paying sustainable jobs for the 12,400 forestry workers and their families who will still rely on the coastal forest industry when the market recovers, in addition to generating the spinoff employment of another 24,000 related jobs.

Let’s not forget the coastal forest industry is one the most diversified manufacturers of forest products in the world and global demand for these products continues to grow year after year. Over the next four years, we have the opportunity to make sure British Columbia’s forest industry not only recovers but continues to be a major contributor to the social and economic well being of our province.

- Rick Jeffery, President & CEO

Correcting the Record on NDP Forestry Critic’s Attack

In a desperate political move, the NDP’s Bob Simpson has decided to pick a forestry fight and side with the Americans and in the process put thousands of B.C. jobs at risk. To make matters worse, Simpson hasn’t even got his facts straight.

Simpson’s latest outburst in a Canadian trade journal [Madison’s Canadian Lumber Reporter] is dishonest, ill-informed and reveals a lack of understanding of an industry looking for leadership not political opportunism.

Claiming that high-grade cedar logging and heli-logging on the B.C. coast is causing “two-bit stumpage” is ludicrously untrue yet may provoke the United States lumber lobby to file costly court challenges which our industry will have to defend.

The facts are that stumpage on the coast has not fallen below $8.99 a cubic metre since 2006 and was at $11.85 a cubic metre through the first quarter of 2009. If Simpson can count, he’ll realize that’s a long way from 25 cents.

The ill-informed NDP critic also attacks the Market-based Pricing System, calling it a mess and implying that it contravenes the Canada–U.S. Softwood Lumber Agreement – another patently untrue and dangerous statement.

MPS was updated in January as part of the annual update process to reflect ongoing market conditions and the market price of logs and lumber. The update was 100 per cent in compliance with the Softwood Lumber Agreement and followed the rules and procedures provided in Article XVII (2) of the SLA. Indeed, the changes improved the accuracy and reliability of stumpage prices ensuring they are truly market based.  Picking up another old fairytale from his union bosses, Simpson also wants to “restrain and restrict log exports through incremental taxation”. If the NDP did this, it would bring immediate trade action by the U.S. because it is a clear circumvention of the Softwood Lumber Agreement. The result would shut down what’s left of B.C.’s forest industry.

With less than a week to go before the election, Simpson has clarified the NDP’s position on forestry. Unfortunately, it is a position that will result in thousands of lost jobs and millions of dollars in lost provincial tax money that could have funded schools and hospitals.

- Rick Jeffery, President & CEO, Coast Forest Products Association

FORESTRY LEADERS REJECT NDP PLAN TO TEAR UP SOFTWOOD LUMBER AGREEMENT

During challenging economic times, B.C. forest industry leaders are calling for stability and certainty, but NDP candidates are putting the sustainability of forest communities at risk by threatening to tear up the Softwood Lumber Agreement.

Speaking at an all-candidates meeting on April 24, NDP candidate for Prince George – Mackenzie, Tobias Lawrence, said: “Carole James has stood up and we have said that we would like to renegotiate the Softwood Lumber Agreement… so standing here today, yes we would like to renegotiate.”

“Leader after leader in the forest industry is saying their companies and employees simply can’t afford the reckless promises of the NDP,” says Prince George-Mackenzie BC Liberal Candidate Pat Bell. “It is time Carole James stands up for forestry dependent communities, renounce the comments by her candidate, and support the Softwood Lumber Agreement.”

Coast Forest Products President and CEO Rick Jeffrey noted in a news release on April 24 that without the Agreement, countervailing anti-dumping duties “would shut down the sawmilling business in B.C. and drag the pulp and paper companies, remanufacturing industry and loggers along with it. It would be catastrophic.”

In a recent speech to the Quesnel Chamber of Commerce, the head of the world’s largest softwood producer rebuffed the NDP approach. “In my opinion, it is the height of irresponsibility to put the future of our industry at risk by advocating the province walk away from this deal,” said West Fraser Timber CEO Hank Ketcham.

Lumber Trade Council President John Allan told the Vancouver Sun on April 9, “I don’t see any point in adding gasoline to the fire that is already raging in Washington about protectionist sentiments and enforcement of trade deals.”

“The NDP’s reckless plan has no support from our province’s forest leaders – people who are creating and protecting jobs in northern and rural BC,” says Bell. “In fact, not one major industry group across BC supports the NDP’s plans which include tearing up the Softwood Lumber Agreement.”

In terms of softwood lumber, the forest sector exported $10.1-billion in wood, pulp and paper products last year and $5.6-billion went to the American markets.

- Shane Mills, BC Liberal Party   Tel: 604-648-4258

Authorized by Jim Pipe, Financial Agent, BC Liberal Party

NDP’s Pledge to Acquire Forest Lands Unfunded and Dishonest

In yet another display of uninformed and disingenuous promise-making, Carole James has announced that the NDP government would negotiate with Western Forest Products to acquire 12,000 hectares of privately-owned forest land in the Jordan River.

In 2007 then-Forests Minister Rich Coleman allowed WFP to remove the private land from a publicly controlled tree farm licence. As a result, WFP was able to make prudent financial decisions that helped the company stabilize its finances and keep its 4,000 employees working in sustainable, high paying jobs.

The question this announcement gives rise to is: What exactly do the NDP plan to ‘negotiate’ this deal with? There are no existing funds in the NDP budget for land acquisition and there are no unallocated public lands to “swap” as James has suggested. These gaping holes in the NDP’s platform simply mean the party has no intention of following through on acquiring this land. Furthermore, James’s on-the-fly political promises further diminish the NDP’s credibility and do nothing to assist the discussions between WFP and the Capital Regional District.

- Coast Forest

The Real Facts on Mill Closures, Job Loss in BC

Ken Wu of the Western Canada Wilderness Committee needs to spend less time writing to newspapers and more time reading them. If he had any real awareness of the global market conditions facing forestry, he wouldn’t have made the uninformed comments in your editorial page [As mills shut down, blame B.C. Liberals, 29-Apr-2009].

 But Wu is more interested in spreading NDP falsehoods and radical environmental rhetoric than he is in helping find ways to keep forestry jobs in B.C.’s coastal communities. And to that end, he attacks one of the activities that has kept some families working even though our biggest customer, the U.S., has gone into an economic tailspin.

Let’s set the record straight: Crown log exports last year were 900,000 cubic metres, down from a high of 1.74 million in 2005. And because no logs can be exported if local mills can use them, these exports have kept people working here in B.C. – in the woods, sawmills and pulp mills.

 Wu also strays far from the facts when he talks about old growth in B.C. It is still the backbone of the coastal forest products industry and will continue to be for the next 50 years, providing sustainable high income jobs while contributing revenue that pays for our schools, roads and health care. To ban old-growth logging would cause the immediate and permanent shutdown of the forest sector on the coast and the loss of 12,000 direct jobs and another 24,000 indirect jobs.

 Over 3.3 million hectares of coastal forest has been protected here and there are now more hectares of parkland than commercial forest. The B.C. coast has an enviable balance of land use that is the foundation for sustainability, economic viability and climate change mitigation. Because of this we are a global leader in forest management.

 Lastly, if Ken Wu is seeing a crumbling of “solidarity” among his environmental friends it is most likely because many are realizing that wood products provide a huge benefit over all other building materials by capturing carbon and reducing both greenhouse gas emissions and energy consumption. As the premier states, “Wood is good”.

 

 - Rick Jeffery, President & CEO, Coast Forest Products Association