May 17, 2010
Forestry is Building Towards Positive Recovery

VICTORIA - The British Columbia forest industry is moving forward in recovery and revitalization as evidenced by a plethora of positive signs.

“When you think about the forest industry and you think about the challenges that we've been facing over the last three or four years, you might find it odd to talk about positive signs in the forest industry,” said Nechako Lakes MLA John Rustad today in a BC Legislature speech.  “But the fact is that our forest industry, which has been so important to our province for so long, has gone through many cycles throughout its history.”

Rustad stressed that forestry, like all aspects of the economy, rotates on a cycle of dips followed by strong recoveries. Downturns have been especially pronounced in recent years because of the steep decline in the American housing starts that had a hard impact across the world. In recent months, however, lumber prices have begun to transform from a low of $127 per thousand board feet towards the $350 range. Rustad also added that the emerging Chinese market is playing a major role in the recovery.

“We're working with China. We're working with, actually, many of the Asian countries, but particularly in China. We're working with them around trying to get wood trusses in the houses, trying to build large buildings utilizing wood, trying to understand what they can do with wood products,” added Rustad. “When you think about a country that has 1.2 billion people, a slow change for them means a rapid opportunity for us.

“We need to make sure that we have the right environment, the right opportunity to be able to attract the capital, to be able to create those jobs and take advantage of those markets and that changing supply-demand scenario.”

Rustad went on to highlight specific recent projects that are evidence of the recovery including:

• Canfor’s new Quesnel mill will be opening on June 1 with 100 percent of its fibre going towards meeting new demands of the China market.
• Canfor’s Chetwynd mill starts up today with a $20 million investment in new equipment.
• Canfor’s Mackenzie mill is back up and running with new investment and two shifts.
• Conifex finalizing a deal to purchase Mackenzie mill with plans to be up and running by late summer.
• $45 million new upgrade to Canfor’s Fort St. James operations.
• $10 million upgrade and second shift expansion for Conifex’s Fort St. James mill.
• Radium and Vavenby are both looking toward the potential for restarting this summer.
• Canfor’s Isle Pierre Mill has $5 million of upgrades.
• Apollo Forest Products interest in forestry expansion in the Nechako Lakes region.
• Pinnacle Pellet investing to create a pellet mill in Burns Lake.
• Harmac is adding a second line, increasing employees to 265 with production up by 50 percent.
• Adams Lake Lumber is up and running with a new $100 million state-of-the-art sawmill, allowing Interfor to increase its production hours by 65 percent.

“They're making those investments because they believe in the future of the forest industry,” pointed out Rustad. “They believe in the opportunities that we have in this province, and they believe in the scenarios that are happening around the world. That is phenomenal when you think about what forestry means to us as a province.”

“All of this, when you look at what's happening, is pretty incredible. I have companies around my riding today that have never been busier than what they have seen because of these investments, because of these changes,” concluded Rustad. “I am very optimistic about the future. It is a great time to be in forestry.” 

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