Thursday, December 13, 2018Canada's Leading Online Business Magazine

Forest Products Association of Canada

Canada Grows on Trees

The Forest Products Association of Canada has been the acknowledged go-to voice in representing the country’s wood and pulp & paper producers nationally and internationally in government, trade and environmental affairs. Headquartered in Ottawa, FPAC has been in existence for more than a century when factoring in its precursor organization, which was known as the Canadian Pulp and Paper Association, dating back to 1913.

National forest products is a near $70 billion dollar a year industry and accounts for about 2% of Canada’s entire gross domestic product. FPAC represents 17 members and Canada’s forest industry operates in more than 600 forest-dependent communities from coast to coast, and directly employs 230,000 Canadians across the country.

The Canadian Business Journal recently spoke with FPAC CEO Derek Nighbor about the evolution of the forestry industry and the path it’s looking to take in the future.

“Our direct job to indirect job is a factor of about 3-to-1 in the community, so all-in we’re about 1 million people who work in the forest products sector in Canada,” says Nighbor.

As one would expect, forestry jobs are most often in northern, rural communities where there usually aren’t many other opportunities for employment, so its health and viability become that much more essential for people living in those regions.

Forestry products have always had a large global component to it and it’s definitely a continuing trend. Canada has traditionally sent a significant portion of its wood products to the U.S., but more recently other markets have begun to spout in countries such as China, Japan, South Korea and Malaysia. The Canadian industry has always relied heavily on exports for its prosperity. The overall value of Canada’s forest products exports was just beyond $31 billion in 2014. Canada ranked as the world’s second largest exporter of forest products and the sector is the second biggest contributor to Canada’s trade surplus at $20.9 billion.

Wood has been enjoying somewhat of a renaissance with more and more home builders and commercial architects making it their material of choice.

“Whether it’s for acoustics or aesthetics engineers and architects love building with wood because there are so many cool, creative things you can do with it,” says Nighbor.

Building codes are being modernized here and around the world, which allows for the construction of taller wood structures. The Brock Commons at the University of British Columbia in Vancouver 18-storeys and is one of the tallest wood buildings in the world.

“Where Canada is really able to capitalize is not just with the experience and innovation but also with the way we manage our forests. We’re among the best in the world in terms of how sustainably we manage the forests. For every tree that’s harvested it must be replaced – that’s the law in Canada,” explains Nighbor. “Regenerating trees on managed land sequesters more carbon and the cycle continues. FPAC factors in managing for species at risk, managing to supress fires to managing pests and to protect watersheds.”

Environment

In terms of environmental commitments Nighbor notes that one of the unique aspects about Canadian forestry is the number of third-party audited, certified forest operations there are in Canada. He says it’s something customers are demanding with respect to meeting certain environmental and ecological standards. If you want to be a member of FPAC you need to subscribe to one of those leading certification systems.

“I always remind people in Ottawa that the forest sector was one of the very few industry groups in Ottawa that stood up behind the Kyoto Protocol many years ago,” he proudly says. “We’re inherently a green sector and we’re truly a renewable resource.”

A major benefit is that wood and wood fibre products can displace many of the fossil fuel products. Wood stores carbon. All trees eventually die and that is when they emit carbon and methane.

“If we can, in a responsible way – factoring in watershed and all living creatures – harvest that tree before it turns into a carbon and methane emitter or is attacked by fire or pests we can lock that carbon into a long-lived wood product, gain the economic benefit and the opportunities that come with the commercial side of the business and then replant a seedling and a young tree that is going to turn into a carbon absorber and then the cycle repeats. It’s renewable and sustainable,” says Nighbor.

Forestry is an industry that is enjoyable and easy to be positive about from Nighbor’s perspective. In regular meetings with foresters, ecologists and biologists he sees the immense commitment these professionals have to the land.

“One thing that I enjoy about the sector is that we bring such great economic and social opportunities to Canadians, especially in northern and rural regions while delivering environmental benefits in addressing our fight against climate change,” he says.

Indigenous Relations

The beauty of the Canadian forestry industry is that about 90% of the trees in Canada sit on Crown land. The rules and regulations are governed provincially. It’s a bit different in Atlantic Canada where there is a substantive amount of private land; the ratio is close to 50/50 in New Brunswick and Nova Scotia. But in most of Canada the majority of trees are on provincial land. What comes with that and the rigorous forest management planning that needs to be done is local consultation and engagement with local First Nations communities, town councils and residents. A lot of time goes into that development process.

“In terms of Indigenous communities we’ve had a decades-long engagement with them because of how we manage forests. We also see the traditional knowledge that many of these communities can bring forward,” says Nighbor. “If you think the footprint of our sector in these rural and northern communities we’re very closely linked to the majority of Indigenous communities throughout Canada.”

The strong relationship between FPAC and the Indigenous community brings about consultation and engagement in terms of sharing and developing plans and it creates excellent opportunities for social and economic partnerships such as labour and training programs. Each location will be different depending on the needs of each local community.

Forestry and mining are by far the two leading sectors in terms of employment for Indigenous people in Canada.

“We employ just over 12,000 directly and our sector also works with about 1,400 Indigenous-led businesses, contractors and suppliers,” confirms Nighbor.

Advocacy

A fundamental aspect of FPAC’s responsibilities deals with advocacy and lobbying the government, which is made convenient being located right in the nation’s capital.

“From a sector perspective there are things that we would like to see government act on. We saw it recently in the Economic Statement. We were one of the few sectors that got a $100 million carve-out over five years to support ongoing innovation in Canadian forestry,” says Nighbor.

From the federal government’s perspective it is known that FPAC is the go-to source when it comes to forestry policy, insights and intelligence. As different departments within the government consider policy initiatives they hold committee hearings and consult with the experts at FPAC in order to get a firm grasp on the entire picture regarding what is happening in the sector and what needs to be done to ensure its future success.

Challenges

Access to fibre is an ongoing challenge. The ability to access trees in a sustainable, responsible way is necessary in order to conduct business in the most efficient manner possible. There are also disturbing trends linked to the change in climate. Also, the pine beetle epidemic chewed up 65% of the pine trees in B.C. over the past few years and the spruce budworm has done the same to spruce trees in Atlantic Canada and Quebec.

“We’re seeing worsening fires and pest outbreaks. If we continue on the current track through to the year 2100 there is going to be massive fire and pest disturbance in our forests if we don’t take some kind of action,” says Nighbor.

The question now is how can the industry better manage these fire seasons and possibly plant more pest-resistant trees and be able to access more of the dead wood and clear it out after a fire season as efficiently as possible in an ecologically friendly way.

“The health of our forests is central to our ability to deliver on these economic and environmental opportunities,” adds Nighbor.

Another challenge faced within the forestry realm is something that impacts virtually every business sector – an aging workforce. Without doubt, there is a dearth of skilled and semi-skilled workers available. A third challenge is geography and delivering wood products to market when customers demand, which can be difficult given the remote nature of where the products originate from in the northern and rural areas.

“About 80% of our mills are serviced by one railway. Reliable rail service, reliable transportation infrastructure is imperative,” states Nighbor.

Looking to the future

“The number one thing for me – and this is personal – I view us here at FPAC to be defenders and champions of these forestry jobs and the many communities that need them,” says Nighbor.

FPAC is tasked with the important role of ensuring the continued development of a skilled, quality workforce while examining new innovative methods of creating more of these types of jobs in communities that need them.

“It’s an opportunity to leverage a great renewable natural resource to innovate and address the environmental challenges we’re faced, such as climate change,” he says. “So for me, it’s about the jobs and providing sustainable support for the communities. We want to continue to be a world leader in wood and wood fibre products.”

www.fpac.ca

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