The founder of a Prince George-based manufacturer says he welcomes more than $1.2 billion in supports for Canada’s softwood lumber industry announced by Prime Minister Mark Carney, but wonders whether it will go far enough.
During a visit to Kelowna on the morning of Tuesday, Aug. 5, Carney announced several financial programs as well as policy changes aimed at helping the industry weather the current economic storm.
The financial measures included $700 million in loan guarantees to help the sector with immediate financial pressures, $500 million to help the sector diversify its products and markets and $50 million to help approximately 6,000 workers with training opportunities and income support.
On top of that, Carney said the federal government would change procurement policies for companies contracting with it to use Canadian lumber in their projects as well as the Build Canada Homes homebuilding project.
Finally, the federal government is pledging to diversify the international markets that Canadian lumber can be sold to.
Reached by phone after the announcement, Brink Group of Companies founder and CEO John Brink said the supports are a good thing for the sector. The group includes Brink Forest Products, which makes finger-joined lumber products at a facility on River Road in Prince George.
“What the prime minister is referring to, in my opinion, is to try to take the pressure off our reliance on the U.S. market and do more manufacturing and pre-manufactured homes and such sorts of things in Canada,” Brink said. “Involving more First Nations and then stimulating investment in value-added manufacturing or supporting existing companies in expanding — or surviving for that matter — and I think that’s basically a good idea.
Value-added manufacturing uses wood harvested in Canada to make products rather than shipping the lumber outside the country for similar purposes.
Even though Brink Forest Products doesn’t have a sawmill or a forest tenure, it has still been vulnerable to softwood lumber duties.
Since 2017, Brink said the company has paid out more than $80 million dollars in duties.
“I’ve been in business for 50 years and that has been the issue for the last 50 years,” Brink said.
Despite the Aug. 5 announcement, Brink said he would encourage Carney to be more proactive on duties than the government has been since the 1980s as the sector has paid out close to $10 billion dollars in duties.
“I think what the prime minister is doing is encouraging, but we have to go far beyond that in terms of stimulating value-added manufacturing,” Brink said.
Especially so since the U.S. Government recently announced that it would more than triple anti-dumping duties on softwood lumber to 20.56 per cent and total duties on most Canadian lumber could reach a hair below 35 per cent.
“That means that there is no way that unless the prices increase substantially, any of the companies that I know in today’s market would be able to survive,” he said. “It’s just a question of how much they can afford to lose.”
In a phone interview, Cariboo-Prince George Conservative MP Todd Doherty said the aid is too little, too late given the jobs the sector has already lost and the duties it has been forced to pay due to the lack of a softwood lumber trade deal.
He said his party negotiated a one-year grace period with the U.S. that the Liberals could have taken advantage of when they first became government back in 2015, but both the federal government and the provincial NDP government have shown a lack of urgency in securing a softwood lumber deal.
“If this government wants to do something, they can do something to help get our product to market,” Doherty said.
“Our forestry companies, both large and small, are held captive by the monopoly that our largest rail provider has, making it hard to even get our product to market. So today’s announcement, you know what, it’s needed. But forgive me if I seem a little bitter.”
He said that in the three months since winning re-election, Carney has pursued an anti-growth path that has lost Canada more than $49.5 billion in investment.
When the higher U.S. duties kick in, Doherty said it’s will decimate Canada’s forestry industry with 65 per cent of products sold south of the border.
“I believe that the U.S. (National Association of Homebuilders) and those that are using and seek out Canadian softwood, I believe they are sharing the very same message that we are, that this is going to hurt U.S. consumers just as much as it’s going to hurt the Canadian industry,” Doherty said. “But we’re going to lose jobs here, make no bones about it.”
In a media release issued after the announcement, the Council of Forest Industries welcomed the short-term release but encouraged the federal government to seek a long-term agreement to the trade dispute.
“This support comes at a critical moment for forestry workers, communities, and companies across the country,” said COFI president and CEO Kim Haakstad.
“Initiatives aimed at supporting workers, fostering innovation, enhancing liquidity, and promoting export development through organizations like Canada Wood are important steps toward stabilizing the sector and supporting government efforts to build more homes for Canadians. These investments also lay the foundation for long-term competitiveness.
“It’s significant that this announcement was made in British Columbia — home to Canada’s largest forest industry — where compounding pressures have been particularly acute.”
In another release, the BC Lumber Trade Council expressed similar approval for the announcement as well as a future long-term solution.
We appreciate the federal government’s recognition that support is necessary in the face of ongoing trade uncertainty” said council president Kurt Niquidet.
“These measures are timely,” Niquidet added. “We look forward to working with federal officials to ensure they are implemented quickly and effectively, and that they reflect the realities facing regions like British Columbia.”
United Steelworkers, a union representing tens of thousands of forestry workers in Canada, also welcomed the news in a release calling it “long overdue.”
“These are major commitments and they show the government is finally taking this trade war and this industry seriously,” said Jeff Bromley, chair of USW’s wood council.
“Loan guarantees will help companies survive and Build Canadian procurement is a huge step forward. But we can’t afford another wave of mill closures while we wait for programs to roll out. This can’t get stuck in red tape or stall at the cabinet table. Workers need to see the results now, with wage subsidies, strong labour market supports and real timelines to get this money flowing,”
Earlier in the day, before Carney’s announcement, the City of Prince George’s Standing Committee on Intergovernmental Relations expressed a need to pursue economic development opportunities while BC’s lumber sector is in a precarious situation.
Committee chair Garth Frizzell said the city needs to be ready to take advantage of any supports offered by higher levels of government.
