Editorial: Unwanted biomass

Over the past couple of months, I’ve been to opposite ends of the country where the forest industry in two regions have both struggled to recover from the global financial crisis.

In Atlantic Canada, the forest industry has lost about 15,000 jobs in the last decade with newsprint production suffering the greatest losses. The strong Canadian dollar was a big factor that hurt the region’s export performance, but Atlantic forest exports have risen steadily as the Canadian dollar has fallen. Despite recent comebacks, the industry struggles still.

Over this time, the region has lost a lot of capacity in the pulpwood sector, which has left a large inventory of underutilized chips. The Canadian Wood Fibre Centre (CWFC), has been looking into new techniques to make better use of the region’s wood fibre.

On the B.C. Coast, an increasing element of the timber harvest is log exports while softwood lumber production peaked in 1987 at 4.674 billion bf and was at 1.332 billion bf in 2012. Because of the humid climate, the moisture content in the wood is high, requiring more time and money to dry. Much of the lumber produced is sold green, and this has limited export opportunities to Europe (which requires all Canadian lumber be kiln-dried or heat-treated) and Japan (which implemented new building laws for earthquake-proof buildings and a switch to more stable kiln-dried lumber).

Poor sawmilling economies at B.C. coastal mills have caused many manufacturing plants to close. More and more timber has become too expensive to harvest at the log prices the operating mills can afford to pay. Sawmill residuals are sold to local pulp mills and hog, bark from sawlogs, is an unwanted by-product.

Though both regions have unique reasons for mill closures, what they have in common is an abundance of underutilized wood fibre. As manufacturing plants have closed, sawmills and logging contractors have found themselves with fewer customers for their chips, sawdust, tops and limbs. In order for the forest industry to remain stable over the long run, woody biomass must fetch a value in the marketplace.

As regions that were hardest hit by the U.S. housing market and global financial crisis continue to recover, the ones that find innovative markets for their biomass will be the most competitive. A focus on improving productivity and developing the higher end of the production cycle is important to the wood products industry. Advanced building materials and systems will give the Canadian industry an advantage. But as a country we must extract biochemicals, develop biofuels and use residuals to make wood pellets and chips for our domestic markets in order to build a strong economy.

Any forest industry that has unwanted by-products is uncompetitive.  Rather than penalize log exporters to encourage more wood manufacturing, regulators should consider innovative ways to make all wood fibre more domestically valuable.