This document provides an overview of issues facing Canada's forestry sector leading up to the 2019 federal election. It discusses commodity prices, the global housing market outlook, housing starts, trade issues, employment levels, challenges like protectionism and high costs, and the need for government support. New technologies are transforming the industry but it still faces challenges without a unified strategy from all levels of government to streamline regulations and reduce taxes and fees affecting competitiveness. The next government must address these issues to better support the forestry sector.

1. 2019 Election –
Forestry Sector -
Canada
Paul Young CPA CGA
July 23, 2019

2. Paul Young - Bio
• CPA, CGA
• Financial Solutions
• SME – Business Process Changes
• SME – Risk Management
• SME – Close, Consolidate and Reporting
• SME – Public Policy
• SME – Financial Solutions
• SME – Supply Chain Management
• Academia – Advance Accounting, Public
Finance and Advanced Management
Systems
Contact information:
Paul_Young_CGA@Hotmail.com

3. Introduction
• Canada forestry sector is key sector to the Canadian Economy
• Canada forestry sector has faced protectionism policies -
https://www.canadianmanufacturing.com/financing/canfor-to-
curtail-operations-at-all-but-one-of-its-sawmills-in-british-
columbia-234114/
• The federal government under Justin Trudeau has done little to
support the forestry sector.

4. Agenda
• Commodity Prices
• Global Housing Market outlook
• Housing Starts – North America
• Merchandise Trade
• Wages / Forestry Sector
• Employment
• Issues facing Forestry
• Justin Trudeau and the Forestry Sector
• Technology and Forestry Sector
• West Fraser and Forestry
• What’s next

5. Commodity Prices
Source - https://www.scotiabank.com/ca/en/about/global-economics/commodity-price-index.html or
“Softwood lumber prices slowly recover from
recent lows: May 2019”
Source - https://www.woodbusiness.ca/softwood-
lumber-prices-slowly-recover-from-recent-lows-
may-2019/

6. Global Housing Outlook
Source - https://www.telegraph.co.uk/business/2019/05/16/global-
property-boom-house-prices-hit-breaking-point/

7. Housing Starts
Source – BMO, RBC, Scotiabank and US Government

8. Merchandise Trade
Source - Stats Canada

9. Forestry Sector (Wages)
Source - https://www.livingin-canada.com/salaries-for-forestry-professionals-canada.html or
https://www150.statcan.gc.ca/n1/daily-quotidien/190530/dq190530a-eng.htm
Average wages annually $52,800/year
• Forestry Sector pays between 25% to
70% higher wages than the service
sector
• Forestry sector personal income tax
ranges are between 35% to 40%

10. Forestry Employment
Source - https://cfs.nrcan.gc.ca/statsprofile/employment/ca

11. Issue facing Forestry
• Softwood Lumber dispute - https://www.bnnbloomberg.ca/economics/video/overall-impact-of-
softwood-lumber-dispute-minimal-for-canada-economist~1108540 or
https://www.globalwoodmarketsinfo.com/canada-has-filed-appeal-against-wtos-april-ruling-in-
softwood-lumber-dispute-with-us/
• Carbon Tax – Carbon tax is added on to the cost of production
https://www.bnnbloomberg.ca/commodities/video/applying-carbon-tax-without-cutting-back-
regulations-may-be-costly-jack-mintz~1649746
• High stumpage cost - https://www.timescolonist.com/business/teal-jones-shuts-down-logging-in-
honeymoon-bay-citing-high-log-costs-1.23841024
• Hydro Rates - https://www.drydennow.com/local/rickford-aims-to-cut-costs-for-forestry-sector
• Excessive regulations
• Small business tax reforms - https://www.bnnbloomberg.ca/economics/video/cfib-concerned-by-
potential-tax-hits-to-small-businesses-in-2019~1560874

12. Justin Trudeau and Forestry Sector
Source - https://www.sudbury.com/letters-to-the-editor/forest-industry-isnt-a-
priority-for-justin-trudeau-679008
“My predecessor wanted you
to know Canada for its
resources. I want you to know
Canadians for our
resourcefulness,” he said.
“Pulp and paper workers ask Trudeau to
fight for their jobs
”Source - https://unifor.org/en/whats-
new/news/pulp-and-paper-workers-ask-
trudeau-fight-their-jobs
Source – April 13, 2018

13. Technology / Forestry Sector
Source - https://www.woodbusiness.ca/how-technology-is-transforming-bcs-forest-industry-
5248/
• Investment into new technologies is revolutionizing the way Canada’s forest industry does business.
The federal government reports between 2005 and 2015, Canada’s forest industry cut its total energy use
by 31 per cent and reduced its greenhouse gas emissions by 49 per cent by generating bioenergy from
waste products and increasing energy efficiency.
• AI and Forestry - https://www.weforum.org/agenda/2018/09/ai-can-help-us-map-forests-down-to-
each-tree/
• Automation - https://www.woodbusiness.ca/fully-automated-applying-robotic-solutions-to-the-
sawmill/
• Supply Chain/Digital = https://www.poyry.com/news/articles/how-will-digitalisation-boost-
forestry-operations

14. West Fraser Forestry
Source -
https://www.canadian
manufacturing.com/fina
ncing/west-fraser-says-
worst-of-its-b-c-mill-
cuts-done-after-wave-of-
curtailments-236315/

16. What’s next
• All level of governments need to work on integrated strategy for Forestry
including streamlining regulations, tax fairness, hydro, fees, etc -
https://www.slideshare.net/paulyoungcga/2019-election-canada-and-global-
competitiveness-may-2019
• Next government needs to push for reforms at WTO including a better dispute
mechanism, reduction in protectionism policies, etc. -
https://www.slideshare.net/paulyoungcga/why-do-we-need-the-wto
• The next government needs to stop looking for ways to tax business, i.e. carbon
tax or plastic tax or other taxes.
• The next government needs to focus on port expansion as part of supporting
getting goods to market.