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Category Archives: Business & Politics

Business & Politics

Home Depot same-store sales disappoint, warns of tariff impact

By Uday Sampath
Reuters in the Chronicle Herald
May 22, 2019
Category: Business & Politics
Region: Canada, United States

Home Depot blamed wet weather in February and a slump in lumber prices for its slowest growth in quarterly same-store sales in at least three years, while warning of a $1 billion impact from new tariffs on Chinese imports. Bad weather along with land and labor shortages… creating a supply glut for lumber. Home Depot said weak lumber prices hurt its first-quarter sales growth by $200 million and… could dent overall sales by as much as another $600 million. …The commodity made up nearly 8% of Home Depot’s sales in the last fiscal year. The unfavorable weather also led contractors to delay housing projects and prevented the company’s do-it-yourself customers from working outdoors, further impacting demand for Home Depot’s products in February. Same-store sales at the home improvement chain rose 2.5% in the quarter ended May 5, but missed expectations of a 4.2% increase.

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Trudeau offers Canadian lumber, steel to help rebuild France’s Notre-Dame Cathedral

The Canadian Press in The Globe and Mail
May 14, 2019
Category: Business & Politics
Region: Canada, International

Canada is offering homegrown softwood lumber and steel to help with the reconstruction of Paris’s famed Notre-Dame Cathedral, which was partially destroyed by fire in mid-April. In a letter sent to French President Emmanuel Macron this week, Prime Minister Justin Trudeau said Canada was proud to support France in the reconstruction of the iconic monument. The Canadian Steel Producers Association and the Forest Products Association of Canada have already indicated their support for the Canadian government initiative. “The success of these sectors reflects the talent and hard work of Canadians, and we will be happy to put these assets to work for France,” Trudeau wrote.

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Softwood Lumber Prices Slowly Recover from Recent Lows: May 2019

Madison’s Lumber Reporter
May 14, 2019
Category: Business & Politics
Region: Canada, United States

Some wholesaler standard construction framing dimension softwood lumber prices rebounded slightly last week from recent lows, while most prices remained flat from the end of April. While reasonable amounts of wood are being traded, demand could hardly be regarded as lush. …As a result, sawmill order files remained at barely two weeks. This would be much less if several large manufacturers had not curtailed significant production and announced future curtailments and looming closures for this summer. This very week, more sawmill closures were announced, this time by Tolko Industries. …These sawmill capacity reductions and removals will improve both the log supply and lumber price situation for Pacific Northwest sawmills. …Western Wood Products Association, shows sawmill capacity utilization the US fell slightly while that in Canada tanked by a large amount compared to the same time last week. 

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Trudeau’s action plan on climate change brings B.C. politician out of retirement

The Canadian Press in the Prince George Citizen
May 21, 2019
Category: Business & Politics
Region: Canada, Canada West

Justin Trudeau

KAMLOOPS, B.C. — Justin Trudeau and the Liberal party’s action plan on climate change has brought one former British Columbia politician out of retirement and back into the arena. At his nomination event Tuesday night for the riding of Kamloops-Thompson-Cariboo, Terry Lake, a former B.C. health minister, described to the prime minister the conditions the area faces every summer with the wildfires. “It is like a war zone here, prime minister, in the summer,” he said. “People leave so they can breathe clean air.” Lake said locals are worried because they suffer physically and mentally due to the raging wildfires. “And that’s what brought me off the sidelines,” he said. “It was your and your government’s commitment on taking action on climate change.” With B.C. expected to be a key battleground in October’s federal election, Lake is considered a high-profile candidate for the Liberals in the province.

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Forestry workers prepare to vote on ‘final offer’

Kamloops This Week
May 21, 2019
Category: Business & Politics
Region: Canada, Canada West

Kamloops forestry workers will decide by June whether or not to accept what the union representing them described as a final offer from the Interior Forest Labour Relations Association (IFLRA). …United Steelworkers Local 1-417 president Marty Gibbons said it will take time to co-ordinate votes at every work sites, but noted the goal is to complete the process in about three weeks. USW’s provincial bargaining committee, however, did not sign off on the agreement being presented, nor has it recommended it be accepted or rejected. …The proposed agreement is for five years with about two per cent increases every year, retroactive to July 1, 2018. It’s the same term and wage increase Local 1-2017 accepted from the Council on Northern Interior Forest Employment Relations earlier this year.

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B.C. forest industry can expect the loss of another 12 sawmills over next decade, analyst estimates

By Derrick Penner
The Vancouver Sun
May 21, 2019
Category: Business & Politics
Region: Canada, Canada West

Tolko’ decision to close its Quest sawmill in Quesnel was greeted less with shock than resignation with one report predicting the equivalent of 12 more will be shuttered in the next decade to cope with B.C.’s shrinking timber supply. …Russ Taylor, president of the consulting firm Wood Markets Group, that commissioned the analyst’s report that concluded with that grim assessment. …Over the next decade… B.C.’s timber harvests could put a 2,000 to 2,500-position dent in those employment figures, Taylor said. However, the massive mountain pine-beetle epidemic… and successive record years of forest fires have cumulatively compromised the province’s Interior forests, said industry analyst Jim Girvan, who wrote the report. …“In the worst-case scenario, 13 mills will close,” said Girvan. “In the best-case scenario, 26 mills will reduce (one shift each). Either way, the impact… is the same.” He expects the bite out of timber harvests will start taking hold between now and about 2025.

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Bill 22 is a catch-22 for B.C. forest companies, critics say

By Nelson Bennett
Business in Vancouver
May 20, 2019
Category: Business & Politics
Region: Canada, Canada West

…It is estimated that six to eight sawmills in B.C. will need to permanently shut down due to a shrinking AAC. When those mills close, the Crown tenure – cutting rights – associated with them would likely be up for sale or transfer. …But the BC NDP government plans to intervene in any future sales or transfers. …Doug Donaldson, minister of forests, said… “There was concern that there might have been moves by forest companies to further concentrate tenure while the debate in the legislature was happening”. …Before any sale or transfer of tenure is allowed, the Ministry of Forests will allow First Nations, workers and the general public to weigh in. …But the larger tenure holders are warning that the bill adds to uncertainty, which could curb investment in B.C. …COFI CEO Susan Yurkovich. “But now there is an added test, which is an unknown test. There’s a test of ‘public interest,’ which has not yet been defined.” Bill 22 appears to pit the big players – large tenure holders – against the smaller ones, which often can’t compete for logs to supply their mills.

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B.C. forestry’s stock shock highlights industry troubles

By Nelson Bennett
Business in Vancouver
May 21, 2019
Category: Business & Politics
Region: Canada, Canada West

Look at any stock chart of any publicly traded forest company in B.C. over a three-year period, and you may be struck by what you see: mountains. Whether it is a major player like West Fraser Timber Co.  or a medium-sized company like Conifex Timber Inc. , the stock charts for these B.C. companies over three years all have a similar shape – a mountain slope that starts rising in early 2017, peaks in the summer of 2018 and then slides down to three-year lows. Whereas some B.C. forestry companies were posting record profits one year ago, they have lately been posting losses. Canfor Corp. posted $126 million in operating income from lumber sales in the first quarter of 2018 and a $78 million loss in lumber sales for the first quarter of 2019. …In first-quarter financials, B.C. companies cite lower lumber prices in the U.S. and higher log costs in B.C. for the poor first-quarter showings.

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No timber shortage here

By Nelson Bennett
Business in Vancouver
May 20, 2019
Category: Business & Politics
Region: Canada, Canada West

FORT NELSON, BC — A lack of timber will likely close more mills in B.C. in the coming years, thanks to a dwindling annual allowable cut. But one area of the province that still has an adequate timber supply is Fort Nelson, which wasn’t affected by the mountain pine beetle the way Interior pine forests were and does not have the same conservation concerns over the mountain caribou that its neighbours to the south in the Peace region have. It just hasn’t had much luck getting idled mills in the area restarted. …Mike Gilbert, regional development officer for the Northern Rockies Regional Municipality, has been trying to hammer home the message to government and industry that the… area has an annual allowable cut of 1.6 million cubic metres that has been pretty much untouched for about a decade. …Gilbert said several forestry companies are considering potentially restarting the Fort Nelson mill.

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Industry feels blindsided by Horgan’s top-down changes to Forests Act

By Vaughn Palmer
Vancouver Sun
May 17, 2019
Category: Business & Politics
Region: Canada, Canada West

John Horgan

VICTORIA — The NDP government’s latest foray into regulating timber allocations and forest tenures has triggered a sharp-edged exchange of between the industry and Premier John Horgan. The industry started it off April 12, the day after the New Democrats tabled legislation giving the forests minister a veto over transfers of tenures and cutting rights between forest companies. Twice in the preceding week, Horgan had reached out to the industry, offering a chance to “work together” and an end to “top-down solutions” dictated from on high. But Bill 22, the aforementioned changes to the Forests Act, was tabled without any advance consultation, leaving industry feeling blindsided. “Given the magnitude of the potential impacts, we would have expected to have the opportunity to discuss with you before the changes were introduced, in keeping with the collaborative approach you have spoken about,” wrote West Fraser’s Ted Seraphim and Canfor’s Don Kayne, respectively the outgoing and incoming chairs of the Council of Forest Industries.

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B.C. forestry sector maintains full focus on Chinese market

By Chuck Chiang
The Prince George Citizen
May 17, 2019
Category: Business & Politics
Region: Canada, Canada West

Conflict over Canada’s detainment of Huawei Technologies Co. Ltd. CFO Meng Wanzhou has brought repeated calls in government, trade promotion and academic circles for Canada and B.C. businesses to divert trade away from the Chinese market.  But for B.C.’s forestry-products sector – often seen as one of the province’s fundamental industries, contributing $12.9 billion in GDP to the B.C. economy – those calls to diversify beyond Canada’s largest Asian trade partner have been met with defiance.  Perhaps surprisingly, one of the more recent calls for diversification came at the 2019 COFI Convention in Vancouver last month, when a keynote speaker, Robert Johnston, managing director of the global energy and natural resources division of the Eurasia Group consultancy, told attendees that resource producers should look to alternative markets like India.

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BC and Canadian pulp industry doing better

by Jim Hilton, professional agrologist and forester
Quesnel Cariboo Observer
May 19, 2019
Category: Business & Politics
Region: Canada, Canada West

The recent announcement of the Tolko lumber mill closure in Quesnel this fall is not a surprise considering the imminent shortage of logs due to beetles and wildfires. With the anticipated loss of lumber production, one would assume a loss of wood chips for the pulp and paper industry would mean mill closures here as well. Some recent announcements of pulp mills would seem to indicate otherwise, so what is happening? Last fall, the premier noted that the recent sale of three paper mills was a vote of confidence in the industry and people of B.C. Investments and acquisitions have been taking place in all of the western provinces, with emphasis on pulp mills producing a wide variety of heavy paper products. …While the younger generation no doubt favours digital media, there are still enough people who like printed material to make hard copies a significant product.

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Galloway Lumber mill workers laid off as business changes ownership

By Paul Rodgers & Kimberley Vlasic
The Free Press
May 17, 2019
Category: Business & Politics
Region: Canada, Canada West

Lumber mill workers near Jaffray have been laid off as the business changes ownership. Galloway Lumber has been owned and operated by the Nelson family for the last 75 years, and has been sold to Brian Fehr. Fehr took ownership on April 1 and, at the time, the plant had 25 of a total 44 employees working and plans in place to retool the mill into a fabricating shop, sawmill timber mill and a cross-laminated timber (CLT) plant within the next couple of years. …According to United Steelworkers Local 1-405, all but a few employees were initially laid off, with plans to call back more over a period of several months and an increase to 80 employees possible over the next couple of years.

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TFL 44 Limited Partnership Holds First Board of Directors Meeting Advancing Vision of Stronger Forest Sector in Alberni Valley

By Western Forest Products Inc.
Globe News Wire
May 16, 2019
Category: Business & Politics
Region: Canada West

PORT ALBERNI, British Columbia — The newly formed TFL 44 Limited Partnership, a partnership between Huu-ay-aht First Nations (“Huu-ay-aht”) and Western Forest Products Inc., held their first Board of Directors (the “Board”) meeting today. Aligned with their goal of providing more long-term sustainability for the forest sector and the region, the Board took a number of positive steps forward to execute on several key terms of their partnership agreement. The Board approved moving forward with a manufacturing study to evaluate the fibre supply in the Alberni Valley, including TFL 44 Limited Partnership and Huu-ay-aht lands and crown tenures. This was a key component of the TFL 44 transaction, which closed in March of this year, whereby the Huu-ay-aht acquired a 7% interest in TFL 44. The study will include a market assessment for potential wood products from the fibre produced in the Alberni Valley.

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Selkin Logging Receives Indigenous Business Leadership Award

By Amy Rose
Canfor Blog
May 16, 2019
Category: Business & Politics
Region: Canada, Canada West

We are proud to congratulate… Selkin Logging Limited – for winning the 2019 Indigenous Forestry Product Business Leadership Award. The award, presented by the Forest Products Association of Canada and the Canadian Council for Aboriginal Business, recognizes and celebrates selected Aboriginal entrepreneurs for their success in a forest products business. Selkin Logging Limited was first established in 1990 by Robert and Gladys Michell. …Hiring employees from an Indigenous background has been at the forefront at Selkin – 90% of their current employees are Indigenous. Selkin Logging was chosen for this award because of their efforts in aiding Indigenous employment and development, being an Indigenous entrepreneur in the forest products industry and supporting business leadership and safety performance in the delivery of their products and services.

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Trudeau playing hero on the world stage. Again.

By The Blackpress Editorial Board
BC Local News
May 16, 2019
Category: Business & Politics
Region: Canada, Canada West

Trudeau’s largesse abroad with Canadian’s resources is beyond offensive. …We are taxed mercilessly, and the stress is showing. Yet, this prime minister just announced he’ll be handing Canadian steel and wood to France to help rebuild the Notre Dame cathedral in Paris. If this were a one-off, it could be construed as a noble act. But it is nowhere near a one-off. It’s the latest example of Trudeau’s proclivity toward throwing abroad that which belongs to Canadians. …Consider the context in which this gift of lumber and steel is being given. France is by no means poor, nor is the Roman Catholic Church. Within a day and a half of the Notre Dame fire, $1 billion USD had already been raised in donations to reconstruct the cathedral. This cause has help enough…

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Pacific Truss celebrates 60 years in Cowichan

By Warren Goulding
BC Local News
May 16, 2019
Category: Business & Politics
Region: Canada, Canada West

Grant McKinnon

After 60 years in business the venerable Cobble Hill business, Pacific Homes & Pacific Truss, has selected its focus. “We’ve found our niche on the manufacturing side as opposed to the retail side,” explains Grant McKinnon, one of three sons of Ken McKinnon who formed the company in 1959. …“There is more and more demand for prefabricated homes,” says McKinnon, quickly adding the market for trusses has grown rapidly and Pacific Truss is now serving an international market from its plant in Cobble Hill and another in Creston, B.C. …Grant and a dedicated management team to operate the company that now has more than 100 employees and has hit the $25 million mark in sales. Revenues have doubled in the last 10 years, McKinnon says.

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Galloway Lumber sold to new owners

By Paul Rodgers
Kimberley Bulletin
May 16, 2019
Category: Business & Politics
Region: Canada, Canada West

Galloway Lumber, a business owned and operated by the Nelson family for the last 75 years, has been sold to new owner Brian Fehr. Fehr took ownership on April 1, 2019 and at the time the plant had 25 of a total 22 employees working and plans in place to retool the mill into a fabricating shop, sawmill timber mill and a cross laminated timber plant within the next couple of years. Cross-laminated timber is a wood panel product made from gluing layers of solid-sawn lumber together. …All but a few employees were initially laid off, with plans to call back more over a period of several months, with an increase to 80 employees possible over the next couple of years.

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Getting to yes with First Nations

By Dallas Smith, president, Nanwakolas Council
The Prince George Citizen
May 15, 2019
Category: Business & Politics
Region: Canada, Canada West

Dallas Smith

There’s a prevailing perception among business leaders and investors and even within some First Nations communities that you can’t get a resource development project built in B.C.  Of course, that’s not necessarily the case. There are numerous examples of successful resource projects proceeding in B.C. with active participation from Indigenous communities. The Huu-ay-aht First Nations, for instance, recently signed an agreement with Western Forest Products to acquire a seven per cent stake in its Port Alberni forest operation.  …Leading up to the upcoming Indigenous Resource Opportunities Conference in Nanaimo this month, many business leaders are telling me they’re concerned that the impending passage of federal Bill C-262 implementing the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP) will embolden activists further to challenge resource projects.

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West Fraser Announces Temporary Production Curtailments in British Columbia

Cision Newswire
May 16, 2019
Category: Business & Politics
Region: Canada, Canada West

VANCOUVER – Today, West Fraser announced temporary production curtailments for a duration of approximately two weeks at two British Columbia sawmills: Chasm and 100 Mile House. The decision to implement this temporary reduction is due to the continued challenges of weak pricing in global lumber markets, high log costs and constrained timber supplies. SPF lumber production is anticipated to be reduced by approximately 40 million board feet, in addition to previously announced permanent and temporary curtailments. West Fraser is a diversified wood products company producing lumber, LVL, MDF, plywood, pulp, newsprint, wood chips and energy with facilities in western Canada and the southern United States.

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Forestry Renewal plan misses point, critics say

BC Local News
May 15, 2019
Category: Business & Politics
Region: Canada, Canada West

Just over a month after the British Columbia government announced it would push an initiative to renew the Interior forestry industry, some say the province is a bit late to the game. The initiative seeks to maximize the potential of existing amounts of timber amid the challenges of mountain pine beetle reducing the supply, the impact of wildfires and lower lumber prices. But the Burns Lake Community Forest (BLCF) has been working on plans to tackle these problems for two years, as Frank Varga, General Manager of the BLCF told Lakes District News. …Removing the dead pine from those areas could reduce fire hazards and boost harvesting activity, in so doing satisfying two of the aims of the B.C. renewal initiative. …John Rustad, MLA for Nechako Lakes said he thinks the government’s renewal initiative has merit but its approach is flawed.

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Governments, industry bid on optimism amid timber review

By Blair McBride
BC Local News
May 16, 2019
Category: Business & Politics
Region: Canada, Canada West

The possibility of reduced forestry activity in the near future is sinking in for residents of the Burns Lake region. The questions, anxieties and calculations of the public follow the provincial government’s release of the Lakes Timber Supply Analysis (TSA) Discussion Paper on April 29 and an open house on May 1. Though the level of the new Annual Allowable Cut (AAC) won’t be known until the fall, many people are already examining options for a forestry industry different from the one they’ve known for decades. Speaking to Lakes District News, Burns Lake mayor Dolores Funk takes a glass-half-full perspective of the future. “It is important to recognize that this decrease in AAC does not include the area-based tenures in the Lakes TSA, such as community forests, woodlots and First Nations Woodlands licenses. These area-based tenures will continue to contribute approximately 500,000 m3 to the local economy and provide a level of stability,” she said.

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Kamloops Tolko employees do not need to worry despite Quesnel sawmill’s closure

By Cavelle Layes
Kamloops Matters
May 15, 2019
Category: Business & Politics
Region: Canada, Canada West

Despite the Quesnel branch of Tolko mills announcing they will be shutting down, officials say Kamloops employees have nothing to worry about.  …Kamloops employees, however, do not need to worry, Lockyer says, noting it is a plywood mill which means it is able to use different forms of logs and has not seen the same impacts on their resources. “We regularly evaluate all our operations, including the Kamloops location,” Lockyer says. “It will be fine.” “Kamloops is running, it is within the Tolko ‘core asset group’, so they are fine in terms of closure,” she notes, adding there is no reason for employees to be concerned anytime in the near future.

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Prince George well-placed in tech sector

By Raghwa Gopal
The Prince George Citizen
May 14, 2019
Category: Business & Politics
Region: Canada, Canada West

British Columbia’s tech sector is growing. It’s not just growing in Vancouver, where the province’s biggest companies and organizations currently reside… and that means huge opportunity for regional communities all over the province. That includes communities that have historically been driven by traditional industries, like mining and forestry. …Furthermore, the R&D coming out of UNBC, as well as the access to the largest amount of harvestable wood biomass in Canada, are key factors that can position P.G. at the forefront of cleantech research and innovation in B.C. …Tech adoption is helping traditional industries like mining, forestry and construction become more efficient, competitive, and profitable. This is particularly important in Prince George, where some of the biggest resource companies in the region – like Canfor, Carrier Lumber, and Spectrum Resource Group just to name a few – are continually investing in new technologies. 

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Former politicians named to Canfor board

BC Local News
May 14, 2019
Category: Business & Politics
Region: Canada, Canada West

Two former provincial politicians were re-elected to Canfor’s board of directors at the company’s May 1 annual general meeting. Dianne Watts, who had been Surrey mayor from 2005 to 2014 and the Conservative Member of Parliament for the South Surrey-White Rock riding from 2015 to 2017, was first elected to the board in June 2018. …Also re-elected is Glen Clark, who was the New Democratic Party of B.C. premier from 1996 to 1999 and who previously held a variety of cabinet postings following the NDP election victory in 1991. …Also re-elected to the board is another former politician, this time from federal politics. John Baird served three terms as a Member of Parliament from Ontario and held key cabinet posts under Stephen Harper’s Conservative government in the early part of the decade.

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NDP forestry bill based on ideology, not common sense

By Dan Davies, MLA
The Alaska Highway News
May 14, 2019
Category: Business & Politics
Region: Canada, Canada West

Dan Davies

Nothing carves the heart out of a small community like closure of the town’s largest employer. It happened in Quesnel last Friday when Tolko announced it was permanently closing its Quest Wood sawmill and reducing shifts at its Kelowna operations too. …The Tolko closure has been blamed on a number of factors, especially a lack of fibre supply. …But people in the forest industry also cite the fact that B.C. has the highest production costs in North America. Production costs are exclusively man-made. High taxes like the brand new Employer Health Tax, endless carbon tax increases, and a spike in corporate taxes all weigh down the industry. …Only a month ago, Horgan called on the industry, First Nations, and local governments to come together and come up with team effort to help turn around forestry. A few weeks later, he blindsided the entire industry by introducing Bill 22.

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Hey, Mr. President, what about removing lumber tariffs to make homes affordable?

By Kathleen Howley
Housing Wire
May 21, 2019
Category: Business & Politics
Region: United States

After President Donald Trump announced at the National Association of Realtors convention on Friday that he was lifting aluminum and steel tariffs on Canada and Mexico, the NAHB asked: What about lumber? Canadian softwood lumber used to build U.S. homes carry tariffs of about 20% imposed by the Trump administration two years ago. That adds $9,000 to the price of a typical new home and more than $3,000 to the value of a multifamily unit, NAHB said. At a time when all eyes are on U.S. housing affordability issues, the trade dispute with Canada is “needlessly driving up housing costs,” Greg Ugalde, chairman of NAHB, said. “A prompt resolution to this ongoing trade conflict with our neighbor to the north will help to ease ongoing housing affordability concerns,” Ugalde said.

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Women strive to close gender gap at biz groups

By Alex Gangitano
The Hill
May 21, 2019
Category: Business & Politics
Region: United States

Donna Harmon and Nancy Fletcher

Trade associations have made strides in gender diversity, with more women taking on prominent roles at industry groups. It’s a trend advocates are pushing to build on. …But the data also shows fewer women as they move up the ladder. The vice president level is 44 percent female, the director level 55 percent female and the manager level 74 percent female. Donna Harman has been president and CEO of the American Forest and Paper Association (AF&PA), the oldest trade association in the U.S., since 2007. Harman was first hired as vice president for congressional affairs and held that job for about five years before taking over the association, which represents the forest products industry and its $300 billion annually in products, including paper and packaging. …Harman hailed the changes in the paper industry, where she now finds many women working as engineers at companies. 

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Random Lengths Lumber and Panel Market Report

Random Lengths
May 20, 2019
Category: Business & Politics
Region: United States

The framing lumber market took a step back after showing signs in prior weeks that it might break out of its longstanding malaise. Weather continued to play a role in some regions, but the consensus was that sluggish year-to-date sales had allowed too much supply to build up in the distribution system. Despite reports that consumption in some markets was picking up, ample supplies were available to meet most buyers’ immediate needs. …Structural panel prices fluctuated mildly amid lackluster sales. A quiet week of trading left prices of OSB unchanged across North America. Lean inventories spurred enough Southern Pine plywood sales to maintain a narrow trading range in rated sheathing, but mills struggled to obtain premiums. Recent trends prevailed in western Fir plywood, including price direction.

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The first round of China tariffs already stifled U.S. exports

By Ted Mellnik , Leslie Shapiro and Kate Rabinowitz
Washington Post
May 16, 2019
Category: Business & Politics
Region: United States

President Trump’s trade war with China escalated this week, as China announced tariff increases on over $60 billion worth of goods in retaliation for new U.S. tariffs. …Wood exports to China dropped by $700 million, or 42 percent. Industries affected included firms that buy logs of hardwoods like walnut, maple and cherry and turn them into boards for furniture and flooring. Before the tariffs, about 1 in 4 of these boards went to China, said Michael Snow, executive director of the American Hardwood Export Council. Snow said his industry is looking for alternative markets. “But at the end of the day, there really are no other markets out there that can absorb anywhere near the volume that China was taking in,” Snow said. He added, “If this continues for several months, I think there’s no question that we’ll see mill closures and layoffs in the industry.”

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US Hardwood Heads for a Diverse Export Future

Mike Snow – American Hardwood Export Council executive director
Timber Trade Federation
May 15, 2019
Category: Business & Politics
Region: United States

Mike Snow

China’s tariffs on US hardwood imports have been a wake up call for our industry. Having this sort of brake on trade in a market that until recently has accounted for one in four boards from our sawmills is a major challenge for the industry. Adding to the stress of the situation is the uncertainty. China has said it could increase the tariff from 10% to 25% and who knows if one mis-step in negotiations might trigger that. Making the situation more difficult is that the imposition of tariffs has coincided with a slowdown in the Chinese economy, with predictions that its rapid growth cycle is now over. It’s understandable that the US industry became so heavily dependent on one market. Chinese exports helped keep it going through the recession and until now it has been the simple solution when, as mills say, for every board they produce they can sell two to China.

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Trump wants to slash payments to California for fighting wildfires on federal land

By Joseph Serna
Los Angeles Times
May 22, 2019
Category: Business & Politics
Region: United States, US West

The relationship between President Trump and California has long been fraught, but in the aftermath of the state’s deadliest wildfire season, the acrimony is burning hotter than ever. In November, as crews battled the Camp and Woolsey fires, Trump blamed the state for “gross mismanagement of the forests” and delivered this ultimatum: “Remedy now, or no more Fed payments!” …Now, the Trump administration has taken matters a step further. As California prepares for what some officials fear will be another devastating fire season, the U.S. Department of Agriculture and U.S. Forest Service are withholding reimbursements that state fire agencies say are owed for battling wildfires on federal lands last year. Instead of fulfilling California’s full $72-million reimbursement request, the Forest Service conducted an audit of the California Fire Assistance Agreement and now accuses the state of overbilling. The Forest Service has demanded that the state provide proof of its “actual expenses.”

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Idaho Land Board forms subcommittee to analyze land dealings

By Keith Ridler
The Associated Press in the Seattle Times
May 21, 2019
Category: Business & Politics
Region: United States, US West

Brad Little

BOISE, Idaho — Gov. Brad Little, Attorney General Lawrence Wasden and a financial expert will examine how the Idaho Land Board should invest $240 million from the sale of hundreds of residential home sites as well as commercial real estate properties. Irving Littman, a retired VP at Boise Cascade, was named the third member of the committee. …Another financial adviser has already told the Land Board to use the money to buy timberland and farmland. But at least one timber company, concerned about competition from the state. …Idaho received 5,600 square miles of endowment land at statehood in 1890. Over the years, it has sold about 33% and now has about 3,800 square miles. The Land Board manages that remaining land to make money mainly for public schools, mostly through timber sales. The Land Board is constitutionally mandated to get the greatest return.

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Two of Alaska’s biggest exports are caught up in the US-China trade dispute

By Elizabeth Jenkins
KTOO.org
May 17, 2019
Category: Business & Politics
Region: United States, US West

As President Donald Trump’s trade dispute with China continues to drag out, some of Alaska’s biggest exports expect to be hit with even steeper tariffs than they’ve seen in recent months.  Now the timber and seafood industries are trying to figure out how to do business as the pressure mounts.  …But the situation is very different for Eric Nichols at Alcan Forest Products in Ketchikan. “We don’t have many options to put that log in another marketplace,” Nichols said. “And so we’re very dependent upon what happens with that Chinese market.” Nichols will be on the hook for a 20% tariff for spruce trees shipped to his biggest customer: China. His company sends mostly barges of young-growth trees harvested from Southeast Alaska to the country, and he said that’s the problem: He doesn’t have enough high-value product to help ride out the volatility.

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Tariffs taking toll on hardwood industry

By Frank Stewart, West Virginia Forestry Association
The Intermountain
May 18, 2019
Category: Business & Politics
Region: US East, United States

Retaliatory tariffs from China have been a buzz saw through Appalachian hardwood businesses and the families that own and operate them. The hardwood industry provides an estimated $60 billion economic impact in the 12-state region but that will change this year because of trade with China. Exports make up approximately 50% of the high value hardwood lumber sold and the top market for species like Red Oak is China. …The volume of lumber sales to China have been slashed in 2019 with first the threat of tariffs and then the actual retaliation. …Sawmill owners looked for alternative markets… There is no other market to absorb 32,025 shipping containers of American Red Oak that sold to China in 2017. …It will drive mills out of business this year, losing jobs and outlets for landowners to sell their timber.

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China Forestry Group Corporation to build wood product plants in Russian Far East

Lesprom Network
May 21, 2019
Category: Business & Politics
Region: International

The China Forestry Group Corporation (CFGC) will build mills in the Russian Far East to supply wood products for China. The project is expected to consume around 3 million cubic metres of logs and export finished products to China, as ITTO reports. Russia’s Khabarovsk will be considered as one of the possible production bases. The CFGC is a large scale wood processing enterprise set up by nine enterprises directly under the State Forestry Administration in 1996. Currently the Group has more than 150 international forestry enterprises and has cooperated with New Zealand, Russia, Canada and some South East Asian countries. [END]

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UK timber and forestry values rising – but is it sustainable?

By Gordon Davidson
The Scottish Farmer
May 17, 2019
Category: Business & Politics
Region: International

James Anderson

UK FORESTRY plc is in rude health, with hungry sawmills and processors keen for product – with the result that softwood timber prices are rising, nearly 30% in 2017 and just under 50% over 2018… Head of forestry investment, James Adamson, commented: “the easy answer is to say that it is due to the weak value of Sterling… The actual answer lies in the fact that both global and UK timber supply should be considered relatively finite as replenishing global timber resources is unlikely to be able to keep pace with fellings. This combined with mounting pressure to limit climate change will provide strong friction to expanding the global timber harvest further into the natural forest resource.” “Finding a balance between not over exploiting our domestic timber resource with the ability to upscale domestic production is also limited, meaning from a supply standpoint, timber deliveries are relatively unresponsive to increasing demand, and therefore open to demand led price inflation.

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The International Council of Forest and Paper Associations elects Sylvain Lhôte as its new president

WoodBizForum
May 15, 2019
Category: Business & Politics
Region: International

Jane Molony and Sylvain Lhôte

The International Council of Forest and Paper Associations (ICFPA) has announced Sylvain Lhôte as its new president. According to the announcement, Mr. Lhôte, director general of the Confederation of European Paper Industries (CEPI), was elected at the ICFPA’s recent annual meeting in Vancouver, Canada, which was attended by representatives from 12 ICFPA member country associations. Sylvain Lhôte has 25 years of government and public affairs expertise working with leading material technology and manufacturing industries on climate and energy policies, sustainability and industrial affairs, as well as competition and international trade issues. He will serve as ICFPA president for the next two years in conjunction with his role at the European industry association.

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How a Chinese company plans to revitalize 2 struggling Maine mills

By Lori Valigra
The Bangor Daily News
May 21, 2019
Category: Business & Politics

A Chinese company is investing heavily to restore two Maine paper mills it bought last year and turn them into sustainable, long-term businesses. The head of the company’s U.S. operations said his company, ND Paper, wants to improve efficiency and update operations at the former Catalyst Paper Mill in Rumford and the former Expera Old Town pulp mill, both of which ND bought last year. To do so, the company is rolling up its sleeves, fixing oil leaks, repairing equipment and adding more efficient machinery. ND Paper is investing close to $500 million in the four U.S. plants it has purchased in the past year. That amount includes the purchase prices. Of the total, about $111 million is being directed toward upgrading the Rumford mill and another $40 million for Old Town.

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Wood pellet processing plant considered at Neucel mill in Port Alice

By Troy Landreville
My Campbell River Now
May 17, 2019
Category: Business & Politics

PORT ALICE, B.C. – The Neucel Specialty Cellulose mill in Port Alice could be the future home of a wood pellet processing plant. According to a report from the North Island Eagle newspaper, Arterran Renewables is looking at the feasibility of opening a production plant at the mill. Arterran’s director of business development David Tiessen told the Eagle that Japan is studying the potential for a massive increase in wood pellet production, especially in B.C. Tiessen also told the Eagle that the demand for more production would present a massive opportunity for B.C. and Canada. Port Alice Mayor Kevin Cameron is excited about the prospect of the plant coming to the village. “According to the company’s website, Arterran’s Advanced Fuel (AAF) is made from biomass, the world’s only renewable carbon.

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