One year after leading B.C.’s largest-ever forestry-sector delegation to Asia, B.C. Forests/Rural Development Minister Doug Donaldson is taking an even larger group to three key Asian countries this winter in a push to expand exports beyond the suddenly slowing American market.
Donaldson, whose portfolio also includes Lands and Natural Resources Operations, will visit South Korea, Japan and China Dec. 5 -15 with a group of officials from more than 40 companies, research institutions, unions and trade associations. The number of entities represented by the delegation in last year’s trade mission (to China and Japan) was around 30.
The key difference, Donaldson says, is that this year’s edition will include a large First Nations component. He noted that he realized during last year’s trade visit that it behooves the province to put First Nations communities in direct contact with potential customers in East Asia, since most of these communities’ lumber businesses lack the scale to reach Asia by themselves.
“We’ve consistently had conversations with First Nations communities around tenure and processing more wood locally, so it just makes sense for those First Nations who are interested in growing their economies to have representation on this trip,” Donaldson said. “The major licensees can often establish their own connections - although they do find it worth their while to come along on this trade mission, as well - but there’s a significant contingent of people who represent licensees that aren’t as large, and this trip helps open doors and and make the connections.”
China, Japan and South Korea are B.C.’s second, third and fifth largest wood-product export markets respectively. The three markets combine to make up about 29% of B.C.’s current wood-product exports, although each presents a distinct opportunity for local companies, officials said.
B.C. has been on a major bull market in terms of lumber exports until this summer, when a sudden drop in U.S. lumber prices removed the insulation between B.C.’s forestry industry and the softwood lumber duties imposed by the United States. Prices in the American market for lumber fell from US$600 per 1,000 board feet to US$300 this month.
There are additional factors contributing to a slowdown; officials have cited a striking timber supply in B.C. due partially to wildfires. The downturn has resulted in West Fraser Timber Co. cutting shifts at sawmills in Quesnel and Fraser Lake and laying off 135 workers. West Fraser estimates the adjustment will take 13% out of the company’s B.C. production.
“There are certain things that government can do to ensure we have jobs in rural communities that depend on forestry, and there are areas where it’s difficult to exert influence on as a government - global markets on lumber prices, for instance,” Donaldson said. “But this trade mission is one example of something where the B.C. government has a very legitimate and importance role, and we are acting on it to make sure that there will continue to be rural jobs in forestry.”