foresterab
Full Member
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Well lets see...I have clients who also operate in BC. Wood prices are generally 25-50% cheaper in Alberta than BC. And the prices I'm hearing in the SE states are 10% of that. Why? a few big things:A good example of bad economic policies driving business out of Canada, which will make us even more vulnerable to any tariff action by the US.
This review is likely too little, too late, and focused on the wrong issues e.g., the high cost of doing business in a socialist and actively anti-private sector culture
Province launches review of BC Timber Sales
New forests minister Ravi Parmar puts together panel of forest experts to conduct review
Province launches review of BC Timber Sales
1) BC sets stumpage rates based upon the average of the previous years prices. But it's not very adaptive to seasonal pricing changes and the last few years have been up/down/up/down. If you're paying high stumpage when prices are low...it's bad business. Alberta adjusts monthly in comparison but other jurisdictions (New Brunswick) are fixed regardless.
2) Big supper mills that produce lots of product very effectively with minimal manpower inside the mill are also very dependent upon a single product. Hence the emphasis upon value added industries but unfortunately you also need the trucking fleets/contractor forces to move/provide alternate products to different mills in some cases for value added that have also been decimated by super mills only hiring a single set up.
3) past history of logging hasn't always spread out harvesting well spatially or by species. Guys used to joke the mill was losing money so we'll log some Douglas fir to prop it up...which works until that supply works out. It's the same challenges with low slope/flat ground vs. 80% mountain sides and no roads...huge cost differences that make it tough to operate unless you have cheap wood to offset the pricy stuff.
4) Huge volume losses of forest in recent years due to fires gutted several mills possible wood supply. Still pretty amazed how much of NE burnt the last few years despite being on fires in the same area.
5) Political uncertainty hasn't helped...not just the old growth targets but that has been the latest issue. However political uncertainty has been a feature of the forest industry for it's history and I view it more of the Rural/Urban split on perceptions.
6) Infrastructure costs and hauling costs to get products to market are high for much of BC (and AB, SK, MB, Northern ON) with a huge reliance on rail traffic. The same infrastructure that was built in the 1960's is now fighting to get spur line traffic fed into ever more active mainlines/busier ports.
7) employment numbers per m3 of wood harvested and especially for board foot (bdft) of lumber produced have been dropping for decades. When you hear of mills dropping a shift of staff and doubling production due to mechanization/modernization it's scary. 10 axle B-train trailers hauling 20% more a load compared to old 8 axle trucks adds up in a hurry. Feller Bunchers vs. chainsaw operators. But reduced employment also means reduced political power = easier to focus on what Vancouver/Victoria wants. For those in Ontario it's the Toronto vs. Ontario debate on what's top priority.
