Forestry

Log exports updated

This item, first published in July 2015, is amended with data to November 2016 as published by BC Stats and reference to a January 2017 statement from NDP Leader John Horgan:

“We’ve lost 30,000 forest jobs in this province since the B.C. Liberals took power. The only logs that leave B.C. should be the logs that we can’t use in B.C. communities, in B.C. mills and B.C. wood-product manufacturing.”

…He said that B.C. Liberal forest ministers have routinely overruled recommendations by the province’s Timber Export Advisory Committee, and approved exports.

“Christy Clark’s government has a history of sending more and more jobs and logs offshore every year. Some of the companies doing this have been among her largest political donors over the years, and that raises questions about why Christy Clark has sat back and watched thousands of people lose their jobs and hundreds of mills close in communities across the province,” said Horgan…


I aim to demonstrate trends that allow conclusions to be drawn from real data. Values are converted to 2016 dollars using Bank of Canada currency data published January 2017.

Put simply, we are exporting substantially more raw lags by volume but recording a little more than half of the value per cubic metre than the province used to realize.

2log-exports-average-volumes

The chart demonstrates that export of raw logs, measured in cubic metres, during the Christy Clark tenure, is 567% of what was experienced in ten years of NDP administration.

Surprisingly, the unit value paid to exporters – they reported – declined by almost half, measured in current dollars.

3-log-exports-unit-values

What does not surprise is that, with increased focus on exporting unprocessed timber, British Columbia has experienced substantial loss in forestry related employment. During 2016, jobs in forestry and support activities totalled 56% of the number of people employed in 2000.

4-jobs

I encourage you to scroll through earlier entries here about log exports. One item includes the following points:

  • Sawmills and manufacturing facilities require significant investments in property, plant and people. The shortest route to immediate profit is export of raw logs. It’s what I call “the tyranny of quarterly reports.” Managers are concerned with immediate results rather than creation of a strong business that will prosper over time. Raw log exports provide profits without risk or major investment in physical plant.
  • Various factors mean that mills have high fixed costs while logging has low fixed costs. Investors can ramp up a large logging operation for a few million dollars and do it within a year. Mill owners need permanent, serviced land and tens of millions of dollars. The time for plans, permits and construction will be years. As a result, the easy road for timber rights holders is log exports.
  • Highly automated mills are capital intensive. The BC forest industry has underinvested and is less efficient than it could be. This condition then “justifies” exports. Industry claims that BC cannot compete in manufacturing finished lumber products so the only choice is to ship logs elsewhere.

Today’s government believes that serving the multinational corporate agenda is Job One. There is no political vision for the future, no desire for British Columbians to be more than hewers of wood and drawers of water. If it were different, government would decide to promote value-added efforts. However, that would displease influential supporters who profit from the present system. Again, the easy road is to export unprocessed resources.

The tough choice, although the appropriate one for the long term, would be to ensure substantially more value-added activity in British Columbia.

Liberals are particularly devoid of vision because their only real expertise is selling. Like prostitutes and drug dealers, they aim for quick scores. Their disregard for wood industries and their thoughtless embrace of foreign LNG operators prove this true.


Raw Log Exports: A Made-in-BC Problem that’s Only Getting Worse, Torrance Coste, The Tyee, February 4, 2015

A link to this video was suggested by a reader, in comments.

12 replies »

  1. The BC Liberal 2013 election platform stated, “Banning exports of unprocessed logs won’t solve timber access issues for mills, especially coastal ones. Even as they promised to ban log exports in the 1990s, the NDP actually grew such exports from nearly nothing to 3 million cubic metres a year.” This was accentuated with a graph illustrating log exports going off the charts in the 1990s.

    The platform also promised the BC Liberals would, “Work with the coastal forest industry to balance the needs of those in the industry who need to export unprocessed wood with mill owners who require wood in order to keep people employed in their mills.”

    The revised graph for the next election illustrating total exports under the BC Liberals compared to the NDP exports and demonstrating the balance with the needs of mill owners should be interesting. Assigning the constant dollar comparison to those numbers will be even more interesting. But don’t look for that graph in the 2017 BC Liberal election platform documents. It will be found in the documents prepared by the NDP.

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  2. Once, many decades ago, what might be called the paleo-right government of BC used the public forest resource to encourage coastal forest products companies to invest in mills because that provided “socio-economic benefits” which in turn encouraged and availed development of the province by droves of ordinary wage-earners who accepted the invitation via ever expanding blacktop, and nationalized ferries and hydro-electric production, the latter providing cheap, publicly-owned power as inducement to commerce, industry, and individual citizens. Ignoring obligations owed to First Nations, these socio-economic benefits easily afforded big profits, and decent wages demanded, and generally achieved by a strong organized labour movement with well established political representation in the BC Legislative Assembly.

    The forest industry flourished under a new type of Tree Farm Licence that ensured long-term timber supply and committed industry investment in managing development, which in turn fostered integration of operations, industry supplying itself with everything from seedlings, to machines, to a host of products, and advanced products and production research. The paleo-rightists and trade unions stood each other off implacably on either side of this wealth, but socio-economic benefit kept accruing from healthy industry and workforce, in balance.

    Then the paleo-rightists stumbled and fell, probably as much from their own moribundity as from the ascent of a newer, diversified political left supported by more than just unions. Disguised by much the same old right-wing rhetoric, a new corporate polity appeared which pretended to be avenging free-enterprise hero of that gloriously prosperous past. But these neo-rightists eventually have distinguished themselves from their claimed forebears by limiting the invitation to prosperity, ignoring or sabotaging the policies that encouraged the broad participation and investment of all citizens, and turning polarized political rhetoric into an actual agenda with real intent to exterminate its one-time contender. Industrial integration's gone, public enterprise is on its knees, and the prospect of finally making good on that long-overdue debt to FNs becoming less affordable every day.

    All of this by blind, ideological hatred of the prefix “socio~”, and its substitution with “crony.” Only by evading prosecution have the neo-rightists chauvinistically rationalized their complete crony-o-economic failure, and cultivated subterfuge, painful inequality, racism, and of course, cronyism. The rampant self-indulgence has deluded the favoured that “free-enterprise” in a cage works best when government and citizens are driven into penury. They must be crazy.

    They never could get past “socio~” and so could never comprehend— let alone continue— socio-economic benefit such as we once knew; like a vampire, they can only live by parasitism, soothing the cravings so frequently that the horizon from which true economic management can be seen isn't even on their radar. Log exports are like a fix.

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  3. The real problem of course is the phoney economic philosophy that we, as a global community, live under. As the late Ed Deak would say, the crooks and thieves are running the show.

    As our natural resources are almost given away, multinational corporations are making tens of billions in profits and there is very little or no “trickle down” to be had.

    We are speeding headlong into a major social/economic catastrophe and there is no stopping this train.

    As a student of history (and why history is seldom taught today) one finds when over 30% of a population becomes dissatisfied with a country or its government or both, revolution occurs. Now this revolution can be quiet or violent, you can't have both.

    When revolution occurs, all types of charlatans are on the stump, hawking their own utopia, (Mussolini, Hitler come to mind) and if they are charismatic enough, they sway the population to share their vision, no matter how evil it is.

    Today, we see this with Donald Trump.

    In BC and Canada, the global economic parties are letting foreign money dictate, how we live; how we learn; how we operate in our own society. We sell houses off shore to billionaire land speculators, which is supposed to be good for the economy, while the same people scream at the mention of rising the minimum age. We have become vassals in our own house. So here is the problem as i see it:

    The Boomers are now at a point in time of spending their parents hard earned investments, passing the point of being producers and now have become consumers in their old age.

    The Gen X'ers are busy making money in a depleting economy, many adhering to dated political philosophy of an earlier generation and ar living off the remains of the fruits of the their grandfathers and grandmothers. They are consumers extraordinaire.

    The Millennial are being left with almost nothing as the previous two generations have consumed one hell of a lot of cash, with very little to show for it. Investments are self serving and “0” thought has been given to future generations.

    We have gone from the “Me” generation with the boomers; through the “F***You” generation with Gen-X; and now we enter the “We got F***ed” generation of the Millennials.

    This will make for interesting brew, as contracts signed to day, maybe seen as treason by the Millennials and those signing them “enemies of the state”. The Millennials will have absolutely no compassion for those who they deemed, robbed them of their future.

    So, as the Premier gives away our natural resources, her place in history may become more than tarnished and she may, and the other lick spittle Premiers and Prime Ministers out there, be compared to the likes of many despots before.

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  4. “Like prostitutes and drug dealers, they aim for quick scores. Their disregard for wood industries and their thoughtless embrace of LNG fantasies prove this true.”

    I love it when you channel a bit of Alex T., Norm, LOL!

    I felt some of that rage when I woke up from a dream this morning, In the dream, my brother — who doesn't seem to spend much time on politics — phoned me to yell, “They just sold another 2,000 hectares to an offshore forest company!”

    I awoke immediately, believing it to be true.

    My hope is that hundreds of thousands of BC voters will wake up and see the truths that the BC Liberals have done so well at covering up. Voices like Norm's will help lead them to that truth… but we readers need to spread the news — first, by simply sharing the link to this site.

    Get the fire started, others will add their own fuel.

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  5. The raw log exports travesty is even worse when you consider that Campbell reduced the number and volume of genuine log auctions, which required piles of logs to actually be bid on before they were shipped out, which enabled local sawmills and small remanufacturers to bid competitively for raw logs, but of course those required the Ministry of Forests to allocate staff and resources to the process. It paid off well, of course, but it flies in the face of the supposed free-enterprise ethic in which Third World jurisdictions like B.C. are expected to give away their raw resources to big foreign interests and serve external interests first.
    Simple fix: bring back genuine local and regional log markets.
    Oh and by the way if anyone finds the street address of the “Vancouver Log Market” on which resource rents are based pleased let me know, because really it's an artificial construct of the major forest companies when they trade logs amongst themselves.
    john@johntwigg.com
    Thanks Norm!!

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  6. Most of the raw logs being exported are from the interior. Countless sawmills have shut down, take Weyerheauser for instance. They had 9 sawmills all working now they have 1, have they lost any timber quota. No they haven't, all the logs they use to cut in BC are now being shipped to china or the USA. I personaly believe this is happening because our sawmills are unionised and all loggers are not. Check out how many { what used to be IWA members} are still working in this province . There was 50,000 IWA members paying dues in 1990. THANKS for letting me rant.

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  7. Looks like removing red tape (aka professional foresters) has given the timber companies an open season on log exporting.

    I know it would hurt the job of fallers and truckers temporarily but the first question on timber quota applications should be “Where is your sawmill that will be using this wood?”

    If the answer is “Out of the country,” the answer should be, “Take a number and we'll put you in a limited lottery for log exports.”

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  8. First off everyone should know there are no such thing as “FALLERS” anymore. All logging in the interior of BC is being one by mechanical harvesters.

    Some of the operators don't even carry a chainsaw with them as in the story of a couple of dimwits I personally know that had to stay in the bush overnight because of windfalls across the road and no saw to cut them away.

    There are probably 200 plus logging truck loads of wood taken out of the North Thompson region every day destined for parts unknown.

    We, the people, get about .25 cents for a log the size of a telephone pole.

    Our forest harvesting should go back to the tenured model where the wood is processed and any value added operations done where it is harvested. The small towns in the interior have been decimated by the Lieberal grab and run sale of out forests. The remind me of a bunch of kids that have stolen a case if chocolate bars an are eating them as fast as they can before they get caught.
    By the way, comparing the Lieberals to prostitutes are giving the honorable prostitutes a bad name.

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  9. When the polling showed the NDP would win the last election, logging trucks with raw logs were going crazy on mid Vancouver Island, couldn’t get them out fast enough. Look for more of the same across the province leading up to this election, just in case.

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