Ministry of Forests, Lands, Natural Resource Operations and Rural Development Albert Nussbaum, RPF Mapping the Course Conference Vancouver Washington January 23, 2020 1
Ministry of Forests, Lands, Natural Resource Operations and Rural Development • BC’s Forests • BC’s Forest Industry • Coast Forestry Industry Challenges • Addressing these Challenges • Harvest Projections • Conclusions 2
Ministry of Forests, Lands, Natural Resource Operations and Rural Development B.C. has significant forest resources. 3
Ministry of Forests, Lands, Natural Resource Operations and Rural Development Ownership Crown Land Private Land Nisga’a Lands Tsilquot’in Area B.C. Forests are publicly owned. 4
Ministry of Forests, Lands, Natural Resource Operations and Rural Development • Comprised of forestry, B.C. Forest Sector by Industry logging, wood products share of forest sector, % and paper manufacturing. • Important part of BC’s Pulp and paper Forestry & manufacturing, economic base. logging, 26% 16% • Supports 54,100 direct jobs and significant government revenue Support Activities for forestry*, 10% Wood product manufacturing, 48% Source: Statistics Canada 5
Ministry of Forests, Lands, Natural Resource Operations and Rural Development • $18.4B in manufacturing Total Export Value sales (2018). $1.6 $16.0 • Monthly Value (lines), C$ Billions YTD Value (bars), C$ Billions Exports of $14.9B (2018). $1.4 $14.0 • Wood products had $12.6B in manufacturing sales, with $1.2 $12.0 sawmills accounting for $1.0 $10.0 $6.8B $0.8 $8.0 • Pulp/paper manufacturing had $5.8B in sales, with $0.6 $6.0 $3.6B from pulp sales. $0.4 $4.0 $0.2 $2.0 $0.0 $0.0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2018 - YTD 2019 - YTD 2018 - Monthly 2019 - Monthly Source: Statistics Canada 6
Ministry of Forests, Lands, Natural Resource Operations and Rural Development The Resource Coast Area in Total Coast Live Volume Millions of ha Billions of Cubic Meters 9.13 3.01 Forested Crown Forested 8.02 2.87 Legally Harvestable 5.62 1.85 THLB 2.59 0.86 7
Ministry of Forests, Lands, Natural Resource Operations and Rural Development B.C. Coast Harvest Volume 30 million m³ 25 20 5.1 5.2 5.4 4.1 4.2 4.7 5.1 5.5 15 5.0 10 3.3 15.1 14.2 14.3 13.9 13.2 13.1 12.3 12.4 11.6 5 7.9 0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Crown Land Private/Federal Land Source: Harvest Billing System 8
Ministry of Forests, Lands, Natural Resource Operations and Rural Development Over the last ~ 15 years, the Coast has experienced: Factor 2003 2017 Change 43,800 25,800 -41% Direct jobs Lumber production 2.5 Bbf 1.4 Bbf -44% Pulp production 3.7 M tonnes 1.8 M tonnes -51% 1.5 Mm 3 2.7 Mm 3 Crown log exports +80% 9
Ministry of Forests, Lands, Natural Resource Operations and Rural Development Labor Climate Land Rugged Terrain Withdrawals First Nations Low Value Consultation & Species Accommodation Softwood Waste Levels Lumber Tariff 10
Ministry of Forests, Lands, Natural Resource Operations and Rural Development Labour Climate 2019 Coast AAC Distribution 5% Western 5.0 Mm 3 5% Other 3.9 Mm 3 11% BCTS 2.9 Mm 3 34% Interfor 1.7 Mm 3 Timberwest 0.7 Mm 3 Teal Cedar 0.7 Mm 3 19% Total Coast 14.9 Mm 3 26% Source: BC Provincial Government AAC apportionment commitment reports 8Mm 3 – millions of cubit meters 11
Ministry of Forests, Lands, Natural Resource Operations and Rural Development Steep Slopes 12
Ministry of Forests, Lands, Natural Resource Operations and Rural Development Coastal Harvest 2011 to 2019 25 Percentage Area Harvested 20 by Slope Class Conventional 15 Steep Slopes 10 5 0 0_10 11_20 21_30 31_40 41_50 51_60 61_70 71_80 81_90 91_100 >100 13
Ministry of Forests, Lands, Natural Resource Operations and Rural Development Low value species Harvest Profile for 2018 B.C. Coast Inventory Profile for 2018 B.C. Coast (18.0 mil. m 3 ) Red Cedar, Balsam, 12% Red Cedar, Balsam, 16% 14% 17% Other, 7% Other, 16% Hemlock, Hemlock, 35% 37% Douglas Fir, Douglas Fir, 30% 18% 14
Ministry of Forests, Lands, Natural Resource Operations and Rural Development Softwood Lumber Tariffs An issue primarily on cedar lumber which is largely shipped to the USA and is of high value Waste Levels “Avoidable waste” has increased from ~4% of stand volume to ~16% in the past 15 years due to the economics of removing this lower grade fiber 15
Ministry of Forests, Lands, Natural Resource Operations and Rural Development First Nations Consultation & Accommodation 16
Ministry of Forests, Lands, Natural Resource Operations and Rural Development Land Base Pressures 17
Ministry of Forests, Lands, Natural Resource Operations and Rural Development Addressing these challenges • Tenure transfers – public interest test • Encouraging domestic consumption of timber • Encouraging establishment of new users of fibre and producers of higher value products • Establishing Fibre Recovery Zones • Changing how the fees companies pay to harvest on crown land are determined 18
Ministry of Forests, Lands, Natural Resource Operations and Rural Development B.C. Provincial Crown Harvest (Historical and Forecasted) Crown Harvest Volume (m 3 , millions) 90 83 80 66 73 72 71 69 68 68 67 66 64 70 64 63 64 53 62 62 61 52 55 59 48 51 50 50 51 60 51 53 50 49 49 47 45 47 51 50 46 50 45 42 40 37 40 35 30 20 20 20 20 18 18 17 17 17 16 10 15 15 15 15 15 14 14 14 13 12 11 10 0 Coast Interior 19
Ministry of Forests, Lands, Natural Resource Operations and Rural Development • BC has significant forest resources that are largely publicly owned • While the forest resource is large, only a portion of the is available land base is currently economic • Coastal harvesting operations face a significant number of challenges • The BC Government is attempting to address some of those challenges through policy changes • Harvest is expected to remain well below allowable levels for the coming year with modest improvement thereafter 20
Ministry of Forests, Lands, Natural Resource Operations and Rural Development 21
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