Forestry Industry Resuscitation

USW Local 2009 has been significantly affected by curtailments and threats of mill closures including the announcement of the closing of Interfor’s Hammond Cedar Division in Maple Ridge on September 3rd, 2019. This decision has directly impacted 147 forestry workers and an estimated 50 additional contractors. Interfor’s decision was not made because the mill was not profitable (it was) nor was the decision made because of the lack of fibre. Interfor holds approximately 30 tree farm licences with approximately 3.34 million cubic meters of tenure.

We urgently need a plan to Build a Secure, Sustainable Future for the BC Forest Economy. We are interested in exploring solutions on how our union can work with government to ensure a smooth introduction and implementation of a bold, vibrant and sustainable plan.

FALLING FORWARD

The forest industry has been a cornerstone of the B.C. economy for more than 100 years. Forest workers generate approximately $1.15 billion in revenue to the provincial government. This revenue is necessary to pay for the public services that we all depend on. The industry provides direct employment to over 50,000 British Columbians. In addition, for every one forest job there are four indirect jobs. More than $13 billion of BC's GDP and over one-third of BC's exports come from forestry.

Stated simply: Forestry makes British Columbia possible. And despite the rhetoric from naysayers, forestry can and must be a major part of our province's future.

After decades of de-regulation and allowing foreign forestry companies to write the rules, our province is suffering from massive mill closures and loss of family-supporting employment. The long-standing social contract -between the citizens of British Columbia and corporations that wish to profit from our forests has been shredded.

The United Steelworkers believe that BC's forests belong to the people of BC, and must be used to maximize local jobs and community benefits. British Columbia forest workers are proud of our work. We're proud that our work has built British Columbia. We know with urgent action, forestry can continue to support our families, our public services, our communities and our entire province.

While we do not accept the notion promulgated by the media that it is a sunset industry, we do recognize that forestry is an industry in transition in British Columbia.

Much of the discussion so far, has rightly been focused on the need to support displaced workers and communities and to address the impacts of closures as the rebalancing of mill capacity and available fibre occurs. But a question also on the minds of citizens is, what does the future look like for the BC forestry industry? Where will we be once we have moved through this period of transition? How do we maintain a vibrant, diverse and globally competitive forest sector?

There are factors like market volatility and trade uncertainties that are beyond our control, so our focus should remain on ideas where we can influence outcomes. Some ideas are not new. Some ideas should be implemented by industry, others will require government action, and all will require a collective effort from workers, unions, contractors, communities, First Nations, academic institutions, and all those involved in the sector to build the industry of the future.

Between 1990 and 2015, the number of large and medium size sawmills in BC declined from 131 to 70, a 47 per cent decline. Veneer mills went from 20 to 13, a 35 per cent decline; pulp mills went from 24 to 17, a 29 per cent decline; and the number of paper mills was halved from twelve to six.Coastal sawmill production has been more than halved in just 25 years. As mills have closed, raw log exports have soared. In the four years beginning in 2013, the Liberal government allowed 26 million cubic metres of raw logs to be exported from BC, the highest four-year tally in provincial history.

For decades the forest corporations have been the real landlord, the real rent collector of our public resource. Companies have happily paid below-market rent to the government for the trees they cut. That discounted rent, in the form of low stumpage payments, allowed the companies to make handsome profits. These days, the handsomest of those profits come from selling raw logs to out-of-country buyers.

Tree Farm Licences (TFLs) typically encompassed enormous areas of Crown land, which forestry companies paid a token amount to hold on to. Historically, in return for gaining access to huge swaths of publicly owned timber in new TFLs, forestry companies had to agree to send the timber they logged to their own manufacturing facilities to provide local employment, the quid pro quo arrangement known as appurtenancy. This applied equally to the small portions of private lands rolled into the TFLs.

In 2003, the terrible reversal of this decades-long social contract occurred with the passage of the provincial Forestry Revitalization Plan, which proved to be anything but revitalization. Under this statute, the tying of forest tenures such as TFLs to manufacturing facilities and employment was formally ended.

Our BC forestry industry has evolved into a classic high-grading , cut-and-get-out exercise for forestry corporations that are clearly not interested in the long run.

Domestic manufacturers are now frustrated because despite a willingness to pay full market price for logs, some licensees are not willing to share the timber supply, hoarding logs for their export program.The big issue isn’t log exports, it’s control of the timber supply, and having the timber supply in too few hands.

In 2003 the government addressed the BC forestry crisis with the three top Forestry Companies that quickly became known as the 3 Amigos . The 3 Amigos raised hopes of a vibrant, growing, value-added industry, while promising investments in research and market development, promising thousands of forestry jobs. The government responded by granting them lower wood costs , a new collective agreement with industry workers , settlement of aboriginal land claims and new laws governing forest practices (significant de-regulation).

As it turned out, the promises of the 3 Amigos were nothing but a pack of lies. After reaping millions of dollars in profits, Weyerhaeuser has now almost totally left Coastal BC and returned to the US, selling its lands and virtually all of its mills.

TimberWest has transformed itself into a major log exporter and real-estate developer. Instead of creating jobs it has closed every sawmill it owned, contracted out virtually its entire workforce and sold off its logging equipment.

Interfor has invested in the US, buying multiple mills (14) while permanently closing five of the six coastal mills it had in 2003. Most of its profits and any cash-back from the softwood lumber deal continues to be invested almost exclusively in their US facilities.

In terms of promised investment, many more mills have been closed and nearly as many jobs as the 3 Amigos promised have in fact disappeared.

The forestry industry today is ruled by the new 5 Amigos, who hold the majority of tenure and power. Canfor (10,811,298 million m3), West Fraser Mills (5,761,251 million m3), Western Forest Products (5,759,837 million m3), Tolko Industries (3,424,496 million m3), Interfor Corporation (3,343,116 million m3).

Together with Brookfield Assets , who controls the private Island Timberlands, these forestry companies have rebelled against the NDP government and their recently introduced repatriation of regulation in the forestry industry. The changes that have annoyed and angered industry most include;

1. Bill 22- which interrupted the unfettered right of forestry companies to transfer tenure from one company to another while only considering the needs of corporations and shareholders and neglecting the significant impacts on workers, communities and First Nations.

2. Amendments to the Forest and Range Practices Act that targeted fee-in-lieu of manufacturing for exported logs harvested from a coastal BC Timber Sales licence. Fees are now significantly higher depending on the economics/value of individual stands, and

3. Significant penalties (triple stumpage fees) are now applied for any avoidable waste fibre left in harvest areas that exceeds new lower waste benchmarks.

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