Proceedings of the Standing Senate Committee on
Agriculture and Forestry
Issue 10 - Evidence - November 2, 2010
OTTAWA, Tuesday, November 2, 2010
The Standing Senate Committee on Agriculture and Forestry met this day at
5:05 p.m. to study the current state and future of Canada's forest sector.
Senator Percy Mockler (Chair) in the chair.
The Chair: Honourable senators, we have quorum. I declare the meeting
I welcome the witnesses to this meeting of the Standing Senate Committee on
Agriculture and Forestry. We have three witnesses today in the first part of the
presentation of the meeting. I would like to share with the witnesses that I am
Percy Mockler, a senator from New Brunswick and chair of the committee.
The meeting will be in two parts.
We will hear from the first panel of witnesses during the first hour of the
meeting, and the second panel of witnesses during the second hour.
We have three representatives from the Canadian Food Inspection Agency in our
Tony Ritchie is the Executive Director of the Plant Health and Biosecurity
Directorate, and Greg Stubbings is the Director of the Plant Program Integration
Division. We also have with us Professor Yves Gagnon, K.C. Irving Chair in
Sustainable Development at the Université de Moncton.
I want to thank the witnesses for being here.
The committee is continuing its study on the current state and future of
Canada's forest sector and looking at the health of our forests in particular.
Before I ask the witnesses to make their presentation, I will ask senators to
Senator Robichaud: Good afternoon. I am Senator Fernand Robichaud,
from New Brunswick.
Senator Fairbairn: Joyce Fairbairn from, Lethbridge, Alberta.
Senator Mahovlich: Frank Mahovlich, Ontario.
Senator Duffy: Mike Duffy, Prince Edward Island.
Senator Marshall: Elizabeth Marshall, Newfoundland and Labrador.
Senator Ogilvie: Kelvin Ogilvie, Nova Scotia.
Senator Eaton: Nicky Eaton, Ontario.
Senator Housakos: Leo Housakos, from Quebec.
The Chair: Thank you, honourable senators.
Before we ask the witnesses to make their presentations, I would like to
bring to the attention of senators that the clerk received a brief in one
official language only.
Honourable senators, do I have permission to hand out the document? The
translation will follow when it is available for the honourable senators.
Senator Robichaud: Mr. Chair, would it be possible to ask department
officials to provide their presentations in both official languages? That may be
harder to do with other witnesses. But it would make things a lot easier for us,
starting with the clerk. Mr. Ritchie's brief, which I have here, is in both
official languages. As for the other witnesses, I do not have a problem, but we
can still make the request.
The Chair: Thank you, Senator Robichaud. I will ask the clerk to take
note of that suggestion and to inform the witnesses when they appear before the
Forestry is an important sector, and we all have a role to play, regardless
of the departments or the stakeholders.
Tony Ritchie, Executive Director, Plant Health and Biosecurity
Directorate, Canadian Food Inspection Agency:
Thank you, Mr. Chair.
It is a pleasure to be here today. I will make my comments in both official
languages and try to keep them to five minutes so we have an opportunity for
questions at the end.
Under the Plant Protection Act, the Canadian Food Inspection Agency manages
policies and programs aimed at achieving two overriding objectives. The first is
the prevention or preventing the introduction of pests or pest risks into
Canada; the second objective is, should those pest risks find themselves present
in Canada, we aim to limit the spread of those pests.
At the same time, the agency maintains or enhances Canada's reputation for
being free of certain insects, pathogens and pest plants. This supports Canada's
ability to meet international standards and guidelines, which sustains the
marketability of Canadian plants and plant products worldwide.
The Canadian Food Inspection Agency (CFIA) is largely responsible for
administering and enforcing federal acts and regulations that protect Canada's
plant resource base.
The CFIA is also responsible for developing import policies and standards,
issuing import permits, approving shipments for release and conducting import
We also work with our provincial partners in industry to limit the spread
domestically, should those diseased pests find themselves in Canada.
The agency shares information with our trading partners when threats are
discovered. We also work with the international community, through the
International Plant Protection Convention, to establish science-based standards
to mitigate such threats.
In 2004, the Government of Canada introduced An Invasive Alien Species
Strategy for Canada. It has four broad strategic objectives: first, prevent the
harmful introduction, whether intentional or otherwise, of plant pests; second,
detect and identify new invaders in a timely manner; third, respond rapidly to
new invaders; and fourth, manage established and spreading invaders through
eradication, containment and control, when appropriate.
The CFIA's role in managing invasive species is to provide leadership among
federal and provincial partners to implement the National Invasive Alien Species
The advances made in our ability to detect, evaluate and respond to invasive
plant pests over the previous five years will be further supported with the
Government of Canada's allocation of $12 million a year to the CFIA in Budget
2010 to continue with invasive alien species activities.
We have recently introduced a draft policy to address the risks associated
with invasive plants in the same way as other plant pests. The Canada's Least
Wanted Invasive Plants pilot project was initiated in 2009. That project saw the
drafting of 27 risk management documents for a group of invasive plants that
could pose serious threats to Canada. These plants have the potential to be
regulated as pests in Canada under the ongoing invasive plants policy
The agency strives to protect farmers, producers and industry from the
potential economic effects of invasive alien species through many different
One such program prevents the movement of firewood out of regulated areas to
prevent or slow the spread of pests from areas already infected to areas that
are currently pest free.
As well, because many people do not realize that there are multiple pathways
for plant threats to enter Canada. We have instituted the Be Aware and Declare!
program, which informs travellers about the types of risks that can come from
bringing items into Canada and that there are serious penalties for doing so.
In terms of forest protection activities, the CFIA continues to work with
other organizations to identify and implement pest eradication, containment and
control strategies to limit the introduction and spread of invasive alien
species to Canada. We work cooperatively with the Department of Agriculture and
Agri-Food, the Canadian Forest Service, Health Canada's Pest Management
Regulatory Agency, the Canada Border Services Agency and others.
We have responded to a number of introduced invasive alien forest pests that
threaten Canada's forests, both urban and commercial. For more than 10 years the
agency has been actively engaged in eradication or ``slow the spread'' programs
for the brown spruce longhorn beetle, the emerald ash borer and the Asian
The agency has also enhanced import programs for wood packaging and marine
dunnage to reduce risks associated with this pathway. Similarly, Canada has
worked closely with our U.S. colleagues to address risks associated with ships
and containers that may carry the Asian gypsy moth from Russia to Asia.
The CFIA is also engaged with the U.S. in developing a number of activities
that would see us align our regulatory practices.
With respect to lumber exports, the CFIA is responsible for the development
of forest policies and certification programs to prevent the spread of regulated
pests from Canada abroad. The agency oversees export programs for Canadian
forestry products so that they meet importing countries' import requirements.
One example of such a program is the Canadian Heat Treated Wood Products
Certification Program. Heat treatment reduces the presence of the pest. This
program provides official certification for the export of wood products to
countries that require heat treatment as a condition of entry. The European
Union, New Zealand and the Republic of Korea are some of the countries that
require this type of treatment. Export certification activities are critical to
support the Canadian industry's interests, competitiveness and economic
Canadian wood products that do not adhere to importing countries'
phytosanitary requirements may be refused entry, or the product may be
destroyed. In other circumstances, the product may be treated at the port of
entry or detained for extensive periods while under quarantine.
For example, the CFIA is negotiating with foreign trading partners on their
acceptance of industry-based certification programs for commodities such as
firewood, cut Christmas trees and logs in an effort to facilitate trade in these
The agency takes appropriate actions to ensure that Canadian products move
without undue hindrance. As such, it is important that the integrity of the
certifying programs be maintained and that we adhere to the highest standards.
These programs provide foreign market access for Canadian lumber and contribute
greatly to the current and future prosperity of the Canadian forest industry.
Yves Gagnon, Professor, K.C. Irving Chair in Sustainable Development,
Moncton University: Good afternoon, honourable senators. Thank you for the
invitation to talk to you today. It is an honour and a privilege to be part of
this important exercise for the wood sector in Canada. I am here as a researcher
in sustainable development and energy, but after talking about that I will speak
about how that is linked to forestry. I will use the PowerPoint presentation of
which you have received paper copies.
I am not here to talk about climate change, but I do want to say a few words
about it to position the recommendation that I will be making to you this
The science of climate change is relatively simple. Through human activities
we generate greenhouse gas which accumulates in the atmosphere and traps energy
such that the amount of energy coming from the sun and trapped in the atmosphere
is larger than the amount of energy leaving the atmosphere. The result is an
increase in temperature.
At the top of page 2 are graphs from the Intergovernmental Panel on Climate
Change. These graphs show the evolution of carbon dioxide, methane and nitrous
oxide, the three main greenhouse gases. The time scale of those graphs on the
horizontal axis is 10,000 years, so it shows the evolution of greenhouse gases
in the atmosphere over that time. We call this type of curve a hockey stick
curve. It is quite flat and increases rapidly.
The arrow at the bottom of the graph points to about 2,000 years ago, which
is the time that Jesus Christ was on this planet. That shows the scale.
On the small graph at the top, we see that there was a great increase in the
concentration of carbon dioxide and greenhouse gases in general in the
atmosphere at the time of the industrial revolution when we started to burn
fossil fuels in particular, which accumulate in the atmosphere.
The light blue curve on the bottom graph on page 2 shows the concentration of
CO2 in the atmosphere. The yellow curve represents the global
temperature. The time scale on this graph is 200,000 years, so much longer than
the top graph. Without going into detail, it shows that there is a strong
correlation between concentration of CO2 in the atmosphere and the
global temperature of the atmosphere. We can pinpoint on those graphs the
glacial periods over the last 200,000 years.
We can see that the concentration of CO2 in the atmosphere is
increasing drastically, and there is an expectation that there will be a
consequential increase in global temperature.
On the top graph on page 3 we see various forecasts of atmospheric
temperature based on different models. The light blue curve is based on a model
with only natural effects, while the pink shading represents natural forcing as
well as anthropogenic forcing, that is, human activities affecting the
atmosphere. The dark line represents the observed temperature at various
locations on the planet.
In summary, we see that the global temperature is changing, and there is
strong indication that this is due to our emission of greenhouse gases into the
At the bottom of page 3 we see where the greenhouse gases are coming from. A
lot of them come from CO2
emissions, which is represented by the pink colour on the bar chart and the
first pie chart. I want to point out that much of the greenhouse gas that we put
into the atmosphere is due to our method of generating electricity. About one
quarter of greenhouse gases is due to the electricity sector.
Considering that the forestry sector is in a period of transformational
change, is there a role for the wood biomass in Canada to help us reduce our
greenhouse gas emissions in the electricity sector? That is essentially the
question I am asking.
Page 4 contains anecdotal evidence, but it shows a trend in terms of carbon
emissions. You will see on this page a bag of what the Scots call ``crisps.''
The bag of what we call ``chips'' has a graph on it to indicate how much carbon
was used to produce the bag. The top graph represents the bag of chips in 2007.
What is interesting, if you look on the right part of the image, is the back of
the bag of chips. On the top right corner, we see the usual information of fat
content, saturated fat content, sodium content, et cetera. Why do manufacturers
provide this information in the food industry? It is because these have become
indicators for consumers. Do I buy this bag of chips or that one? We all look at
fat and sodium content — most of us, Senator Robichaud.
What was the consequence? Manufacturers said if it is an indicator, then we
need to reduce our fat content. Globally, fat content has been reduced in
In 2007, this company in Scotland indicated — you cannot see it in the circle
but you will have to believe me — the CO2
that was put into the atmosphere to create this bag of chips. In 2007, 104
grams of CO2 was put into the atmosphere to generate this bag of
Why did they put that information on the bag? It is a competitive advantage
for this company to disclose this information because it is becoming an
indicator for consumers — do I buy this bag of chips or this one? CO2
will become an indicator of choice. Industry needs to adapt to that.
When I started to present this graph in 2007 in various conferences, people
would ask me is 104 grams a lot? My answer was it is not important; the
importance is that you disclose the information. As a result, it will be
reduced; you will have to reduce it because others will try to reduce it.
In 2010, the same bag of chips generated 80 grams of CO2 into the
atmosphere. You can see the trend of reducing CO2 emissions. This
trend is in Europe, but I think it will reach us here. We need to be serious
about how we manage our CO2 emissions. Again, to reinforce my
message, the electricity sector — how we generate electricity — is an important
source of CO2.
On page 5, the top graph represents the waves of innovation. This is not from
our research work but it is interesting. It shows the various waves of
innovation over the last 200 years — the high-tech sector of the period. About
200 years ago, the whiz kids were working on water power, mechanization and
textiles. As we move along, then came the railroads and steam power. At the
beginning of the century, it was electricity, chemicals and the internal
combustion engine. The next wave shows the innovators of that period: the
petrochemical industry, electronics and aerospace — going to the moon, rockets
and NASA. We are in the period of digital networks, biotechnology, IT and
Many think that the next wave of innovation will be around sustainability,
around renewable energy, green chemistry and industrial ecology. I think the
forestry sector should position itself to be part of this next wave of
innovation as society will change.
In this context of innovation, we see that the forest companies, mostly in
the pulp and paper sector, are adapting through innovation. One example is a
company that has repositioned itself by converting its plant to produce rayon.
We are also seeing some value-added paper. Cascades is a leader in that
innovation. That manufacturer recently came out with an antibacterial paper
towel with a chlorine compound in the paper. When it comes in contact with water
when you dry your hands, this compound becomes an antibacterial solution for
Groupe Savoie, in New Brunswick, is a very good example.
This is a family-owned hardwood sawmill. Essentially, the innovation there is
that every piece of wood that goes into that plant comes out as a product.
Innovation is part of the solution.
I want to talk to you about energy. At the top of page 6 is a map of Europe
with distributed power generation. Traditionally in the energy sector, we have
large-scale electricity generation sites, whether it is on coal, nuclear, oil,
hydro, et cetera. They are large-scale sites of generation localized in various
There is a trend toward distributed power generation. You have a much smaller
generation site, usually tied to a renewable source, whether it is wind energy,
small micro-hydro systems or a biomass plant. We see that some of the countries
have close to 30 per cent of their electricity coming from such small systems —
biomass based systems, wind based systems — instead of going to large-scale
units, as we traditionally have. They are quite efficient.
I have a few examples to finish this presentation and go to my conclusion.
One is the PEI District Energy System, which is in Charlottetown — Senator Duffy
knows this. In Charlottetown, right next to the downtown area, is a clean and
efficient site where they burn municipal and sawmill waste on the Island, along
with a little bit of oil, from which they generate electricity and heat.
It is owned by the PEI Energy Corporation, which is a Crown corporation;
therefore, it is owned by the people of Prince Edward Island. At last count,
this plant heats 84 buildings in Charlottetown. The hospital, all government
buildings, the University of Prince Edward Island, et cetera, are all heated by
this small plant in Charlottetown. The electricity is sold to Maritime Electric.
It is very efficient, fully optimized and truly sustainable.
Another example is from my hometown of Edmundston, New Brunswick, near the
hometown of Senator Mockler. It is a cogeneration site that was built in the
1990s. Many people, including the people at the mill, which is now called Twin
Rivers Paper, think that the survival of this mill is because they have built
this cogeneration plant. They generate electricity that they sell to New
Brunswick Power and they generate heat for their processes instead of burning
The last example is a recent project by Nova Scotia Power and NewPage
Corporation. They will build a 60 megawatt cogeneration plant to generate
electricity that they will sell to consumers in Nova Scotia, but they will also
generate heat for their processes inside the plant. They will harvest some of
the biomass, but they will also use some waste biomass for the sawmills and
paper mills in the region. Essentially, they will have full use of the available
Can wood biomass be a sustainable and viable large-scale source of renewable
energy in the various regions of Canada?
We have biomass. For the traditional wood industry, whether it is pulp and
paper — and lumber is facing some challenges — should we look at community
based, distributed power generation based type of cogeneration systems where we
generate heat and electricity for the use of industry, municipalities, schools,
hospitals, et cetera? That is another way of looking at the energy sector and
the forestry sector, all in line with sustainable development principles.
There are some issues, for example, supply. We need to have better knowledge
in terms of the resource — how much power we can generate from the resource by
having sustainable harvesting of biomass to do that. Having a low carbon
footprint on the generation of that biomass is important.
There is also social acceptance. When we talk about cutting wood, with that
comes issues of clear cutting and the ecological services of a forest. It is not
a given solution; there are various challenges. However, it should be looked at
seriously in Canada to see if biomass can become a source of large-scale energy
in line with the sustainable development of communities in various regions of
The Chair: Thank you, witnesses.
I will ask Senator Eaton to begin the questioning. She will be followed by
Senator Eaton: I do not know where to start; you are both so
Professor Gagnon, we have heard many witnesses over the last nine months. It
seems that clear-cutting is an aesthetic issue; an issue that resolves itself as
the forest regrows.
What worries me a little about your presentation is that you talk a lot about
innovations in Europe, but Spain is a disaster with its green movement and
windmills. Spain's energy policy has not proven to be efficient.
What I find to be more intriguing is the innovation the Canadian forest
industry has been able to do with things like the nano-crystalline cellulose,
NCC, and the production of new products to replace plastics. I am interested in
using waste products to make fuel and energy.
I hope that we move toward innovation rather than to systems that have not
proven to be very efficient, such as windmills or solar panels that, in the end,
cost a lot and do not produce that much power. Do you have anything to say to
Mr. Gagnon: I agree with you that innovation is essential in the
forestry sector. It will be a long time before we will be able to compete with
the Chinese or Brazilian manufacturers.
Senator Eaton: We can compete in the area of nano-crystalline
cellulose. Are they ahead of us?
Mr. Gagnon: This is innovation. Canada should be involved in this
trend. We should go toward innovative products, higher productivity, value-added
products, rather than competing in paper with those countries. I did not touch
on wind and solar energy in my presentation.
I showed you three examples of small-scale systems in Canada, but there are
many others. There are many other many other commercial based or community based
biomass systems that are part of the energy portfolios of their jurisdictions or
Senator Eaton: Are those the examples you gave us?
Mr. Gagnon: Yes.
Senator Eaton: That is largely waste?
Mr. Gagnon: Most of them are waste, but the last one I presented,
one-half of its biomass will be harvested specifically to generate electricity.
Those are two models.
Senator Eaton: Do you think we can afford to do that on a large scale?
Mr. Gagnon: Wood biomass is an actual resource and it is renewable. As
with all resources, there is a lack of knowledge with regard to the assessment
of that resource in the context of energy generation in Canada. Hopefully, in
New Brunswick in the near future we will be able to quantify the wood biomass in
the context of energy generation. Once we quantify that, then governments will
be better positioned to identify whether this is a viable source and a long-
term source of energy.
As a vision for this committee, I recommend to you that you seriously
consider using wood biomass as a potential source of large-scale energy for
Senator Eaton: When you say ``wood biomass,'' do you mean the wood
Mr. Gagnon: It is all forms of biomass, whether it is waste from
biomass or the tops of trees or branches that have no economic value. You need
to balance that with the ecological services that are brought by the biomass
that you leave within the forest. I am not saying it is an easy solution, but I
hope that we will look at biomass as a potential source for large-scale energy
generation while respecting the sustainable development properties of the
biomass itself. The harvesting of the biomass should also be considered.
Senator Eaton: We heard a bit about that in British Columbia. They are
beginning to do that and finding out whether it is economical.
Mr. Ritchie, you said that some countries to whom we send wood demand heat
treatment to ensure we are not exporting our bugs along with our wood. Do we
demand, in return, heat treatment from certain countries to protect us from
Mr. Ritchie: Yes, we do. We have worked with the international
community, through the fora that exist there, to ensure that whatever other
countries require from us, we require in return. All products coming into Canada
have to be heat treated, including those products used as packaging material
around other components.
Senator Eaton: Do we have people on site in countries inspecting what
will be shipped to us before it has left the country, or does it get here and
then we inspect it?
Mr. Ritchie: I think it is a combination of both. We certainly do have
inspections here in Canada. Our framework kicks in at the border. Once the
product arrives here, we work collectively with our colleagues at the Canada
Border Services Agency to ensure that products are inspected. We look for the
stamp. A stamp indicates the wood has been heat-treated.
Senator Eaton: What recommendation would like to see that would make
it easier for you to keep this country free of foreign pests?
Mr. Ritchie: There is an international framework. There is a process
that countries can use to ensure that we collectively develop processes and
procedures that apply across the countries. I would ask that the process be
supported. That is where we need to go. The integrity has to begin in the
international forum. I would ask all countries to actively participate in those
particular forums and adhere to the requirements and standards that come out of
It is important that we work on a regional basis with some of our larger
trading partners. The U.S. is a big trading partner for us in terms of plant and
forest products. The closer we can align ourselves with the U.S. and we can work
across that border in a seamless way, the more beneficial it is for us. If we
can use the U.S. as an ally against other international trading partners, it is
Senator Eaton: We have learned that, more and more, our trade in
forestry will be with the Far East.
Mr. Ritchie: That is correct.
Senator Eaton: Will that present other problems?
Mr. Ritchie: Yes, it will present problems in terms of the pest
control strategies that they apply domestically, and that is where we need to go
to the international community to say there are international standards on how
we should be treating certain pests. All countries need to adhere to those
standards. It will be a challenge. Again, that is where again working with our
collective allies we can intervene in these international environments to
promote better worldwide sanitary practices.
Senator Robichaud: In your conclusion, Mr. Gagnon, you asked all the
questions we have been trying to answer. The Standing Senate Committee on
Banking, Trade and Commerce. Who should we be turning to for those answers? I
know the industry has a role, on one hand. But, on the other, a research centre
such as yours should be able to put forward answers rather than questions,
should it not?
Mr. Gagnon: Going back to the last line in my conclusion, which I may
have rattled off a bit too quickly because of time constraints, as they say, the
question answers itself. To my mind, the answer to the question —Can wood
biomass become a major source of large-scale energy? —is self-evident.
Given that Canada's forestry sector is going through a major transformation,
the energy sector is an avenue that is really worth exploring in order to figure
out how to turn wood biomass into a sustainable and viable source of large-
scale energy in Canada. To do that, the energy sector has to shift from its
traditional method of operation, based on large power-generating stations that
use many transmission lines, towards a distributed power-generating model, based
on small power stations located closer to consumers, consumption centres,
businesses, residences and so forth.
That approach would require fewer transmission lines, which would cut costs.
Biomass is used locally, which is better for the environment because less
transportation is required. At the end of the day, it would strengthen our
energy security. The more power-generating points we have, the more we use
native resources, rather than imported ones such as oil and coal, and the more
energy security we have.
Traditionally, the forestry sector has not seen the energy sector as a
potential user of its resource. We should be moving in that direction not just
because of the changing climate, but also because of Canada's changing forestry
Senator Robichaud: Do you think we missed the boat, given the head
start that wind energy has? New Brunswick has already set up I do not know how
many wind turbines in Caribou near Bathurst and in Kent Hills. The province has
gone to extraordinary lengths to pursue that type of energy production, but no
one has talked about the untapped potential of our forests. And so far,
governments have not shown much interest in it either.
Mr. Gagnon: I want to mention something that Nicholas Stern, a former
senior vice-president of the World Bank, said in his 2007 report. He was an
advisor at the time in Great Britain's government. His was a cutting-edge
report. It was the first report written by such a credible stakeholder in the
economic and financial realm. He showed that climate change was going to have a
huge impact on the economies of both industrialized nations and developing ones,
and that it was imperative to act immediately on numerous fronts. There is no
single solution to climate change.
If you apply that logic to the energy sector, coupled with energy security
concerns, the more varied a country's sources of power are, the more plentiful
its sources of distributed generation, and the more energy security it has.
With that in mind, there is definitely plenty of room for wind energy and
eventually tidal energy, when the technology is sophisticated enough, as well as
solar energy, when the technology is more affordable. But given Canada's
situation, the availability of the resource and the challenges in the forestry
sector in terms of adding value to wood biomass, we should be looking seriously
at wood biomass as a large-scale source of energy in Canada.
Senator Robichaud: I agree that we need to look at that much more
closely, but would you say that the government would not have to contribute as
much financially to the production of wood biomass-based energy as it did to the
production of wind energy?
Mr. Gagnon: The first step should be to determine where things stand
around the country, beginning with provincial pilot projects. A nation-wide
assessment should then be conducted to determine whether the wood biomass
resource is abundant enough to produce energy on a large scale. That includes
assessing the availability of the resource as a sustainable source of energy, in
other words, the regeneration of the resource, and the impact on the ecological
functions of forests. We need to ensure that we can maintain those functions as
we harvest wood biomass. We also need to ensure that harvesting wood biomass
results in as few carbon emissions as possible. Finally, it is necessary to
identify which power generation models based on wood biomass produce lasting
economic benefits for those communities where forestry is the cornerstone of the
Senator Robichaud: We have a big job ahead of us.
Mr. Gagnon: Yes, but you have to start. You mentioned wind energy. I
will give you a meaningful example. Twenty- five years ago, governments in
Denmark funded the development and installation of wind turbines with a view to
turning wind into an economically viable source of energy. Today, the wind
turbines being used around the world come from Denmark or were manufactured
under licence from Denmark.
About two years ago, we studied Denmark's models. Wind turbine manufacturing
generated more than 20,000 jobs, resulting in tremendous economic benefits for
It is important to consider not only the resource, but also the biomass
cogeneration systems, electricity and heat. Canada has an opportunity to become
a world leader in these technologies, as well as logging practices, allowing us
to further expand the forestry sector in a sustainable manner, while giving us a
new way to add value to forest products and to generate economic benefits for
the forestry sector in communities across Canada.
Senator Marshall: Mr. Ritchie, in your opening remarks, you referred
to several policies and strategies, such as the Invasive Alien Species Strategy
and the Invasive Plants Policy. You spoke about the Be Aware and Declare!
campaign. In your briefing notes, you referred to the Don't Move Firewood
campaign. How does the agency evaluate such policies? Do you know that these
policies are effective?
Mr. Ritchie: That is a very good question. The policies play in on
different levels. Some create a greater awareness of these invasive pests and
what we can do to stop them. For instance, the Don't Move Firewood campaign is
critical, because firewood can move pests from one area to another. For
instance, we may come up with a policy that says science tells us we need to
limit the movement, and now we will work with our provincial colleagues to
ensure that they have appropriate procedures in place to limit the movement of
We also utilize permits. If we go into an area that has a pest invasion, our
act enables us to quarantine that particular area, and it also enables us to
issue permits for movements in and out of those particular areas. We have a
certain control on the way the products move.
Firewood is a little more difficult because individuals can go into the
woods, cut firewood and throw it in their truck and drive away. In those areas,
it is hard for us to determine whether it is working. We hope that through
greater awareness, through the provinces and provincial parks posting these
kinds of activities, and limiting the way in which firewood is distributed in
the park environment, we will get good adherence.
We also do surveillance on the pest itself. That provides somewhat of an
indication as to whether we are successful in limiting the spread of that pest
through some of our programs and policies.
Senator Marshall: You spoke about the awareness and mentioned
specifically the Don't Move Firewood policy. I am from Newfoundland and
Labrador, where many people cut their own wood and the wood is moved all over
the place. I have never heard of this policy. Is it that there are no pests in
Newfoundland and Labrador, or is it that the awareness of this policy is not
Mr. Ritchie: You make a good point Senator Marshall. Where there is an
active pest incursion, the promotion is certainly more active because the
pathway to the movement of that pest could well be through firewood. There is a
particular pest we are dealing with in New Brunswick, the brown spruce longhorn
beetle, and we are active in promoting that kind of policy in New Brunswick
because we are actively dealing with in that province.
Senator Marshall: Has that policy been effective in New Brunswick?
Mr. Ritchie: That pest was in Nova Scotia, not New Brunswick; that is
my mistake. My colleague corrected me.
Mr. Gagnon: We have no pests in P.E.I.
Mr. Ritchie: Potato pests, maybe. I misunderstood the question.
Senator Marshall: I am familiar with the Be Aware and Declare!
campaign because it is heavily advertised, but I am not aware of some of the
other campaigns. It makes me wonder about the effectiveness of these policies.
If the Auditor General were to perform an audit, she would ask how you determine
the effectiveness of your policies.
Mr. Ritchie: You are right. With respect to some of the other
policies, for example, the Invasive Alien Species Strategy, the benefit was that
it enabled a number of departments that had an interest in controlling invasive
alien species to come together and understand their respective roles and
responsibilities and to collectively plan. Some of those documents are broader
framework documents that provide an opportunity for those departments to work
collaboratively. It is tremendous just to understand the roles and
responsibilities of each department. The role we play is quite different from
the role of the Canadian Forest Service and Environment Canada. Achieving that
clarity is tremendous. It is hard to measure, but the documents themselves may
do nothing more than enable those departments to understand each other.
Senator Marshall: Professor Gagnon, on page 2 of your presentation,
you spoke about the concentrations in the atmosphere of these three chemicals
over a 10,000-year period.
How do you determine the concentrations in the atmosphere 10,000 years ago?
It spiked a couple of years ago. Is it possible that the recordkeeping is
Mr. Gagnon: No. Essentially, this data comes from the ice shelf in
Antarctica. There are many kilometres of ice in Antarctica. The ice was formed
by snow falling on top of snow, compacting and becoming ice. The ice at the
bottom is snow that fell hundreds of thousands of years ago. By doing a sampling
of this ice core, it is possible to determine the concentration of the
atmosphere at that period of time.
Dr. Ogilvie will agree with me that we see error bars on those graphs, which
indicate the uncertainty of the measurements. We see that the third one is
higher than the first two. That type of data is not contested; it is credible
Senator Marshall: On page 3, do you say that one quarter of the
greenhouse gases are attributed to electric generation?
Mr. Gagnon: Energy supply, yes. That is on a global scale. In Canada,
it is roughly the same.
Senator Marshall: Does that depend on how the electricity is
Mr. Gagnon: Yes, it does.
Senator Marshall: Which would have the lesser impact?
Mr. Gagnon: The principle is we need to move from electricity
generation using fossil fuel, coal, oil or gas. There are various options. As
Senator Robichaud, mentioned, wind energy, which is economically viable, is a
great example on P.E.I. and elsewhere in Canada. The more diversified an energy
portfolio we have, the better it is in terms of energy security and supply of
energy. Wood biomass could become a large-scale source of energy for Canada.
Senator Marshall: What about hydrogen?
Mr. Gagnon: Hydrogen is what we call an ``energy vector.'' Hydrogen is
only a way to store energy so we can use it at other times. If we have
intermittent sources of energy, for example, from wind, tidal power or solar
energy, we could use hydrogen as a way to store that energy and reuse that
hydrogen to regenerate electricity when we need it. Hydrogen is not an energy
source; it is a process to store energy. In the long term, it could become an
efficient way of storing energy, and therefore able to integrate a more
intermittent source of energy that you cannot control, like wind, tidal, or
Senator Mercer: First, I want to thank everyone for the presentations.
Professor Gagnon, you brought to our attention the labelling of the crisps in
Scotland. How did that start? Did the company just say, ``This is a good idea,''
or did someone push them to do it? Is there a regulation that forces British
companies to do it? It seems to me a heck of an angle. I am on a low-salt diet,
so I always look at the labels to see the sodium content, and I cut out buying
certain things because of the sodium content.
Mr. Gagnon: We did not study this company in particular in terms of
the rationale to put the CO2 emissions on the bag of chips. In
Scotland, there are no regulations yet in terms of controlling CO2
emissions. They are positioning themselves in a trend where we will probably see
restrictions on carbon emissions, and it could take various forms, whether a tax
or cap and trade or whatever.
What is clear with this company is that disclosing and then reducing the CO2
gave them a competitive advantage. It is part of their value proposition to tell
the consumers ``Buy my bag of chips instead of the competitors'.''
Senator Mercer: Perhaps there should be a regulation that says that.
Perhaps the food inspection people could take that message back.
I want to continue, Professor Gagnon, with your description of the PEI
District Energy. I also related to the other plants you spoke about, but the
Charlottetown plant in particular because of its burning of municipal waste and
the sawmill waste, et cetera. I come from Nova Scotia where we burn dirty coal
to generate electricity. We are not doing the environment any good at all
because of that.
What is the ash that is coming out of the stack? Most of our plants, other
than one, are in rural areas, and this plant is in downtown Charlottetown.
Mr. Gagnon: I do not have off the top of my head that data, but
typically, in Canada there has been a large reduction in the last few decades of
particulate emission because of technology development called ``scrubbers.''
There is low particulate emission from burning fossil fuels in Canada.
The main emission is CO2, carbon dioxide. We know now that carbon
dioxide has an effect on the environment and the atmosphere, but in terms of
particulate emission it is relatively low.
The plant in Charlottetown is right between downtown and the hospital. It is
quite clean. I have many pictures that I use in my presentations. If it is well
made, it is not intrusive. It is a clean environment.
Senator Duffy: Is there any odour?
Mr. Gagnon: There is no odour. The municipal waste and the biomass are
stored in enclosures. It can be done quite efficiently.
Senator Mercer: Mr. Gagnon, in your presentation you talked about many
things, but you did not talk about any direct relationship with silviculture or
reforestation. I know that you are from New Brunswick where some of the best
silviculture reforestation plants are underway. We visited some of the
reforestation sites and several of us planted trees to reduce our own carbon
footprint. You did not speak about that aspect of the industry.
Mr. Gagnon: As I mentioned earlier, we work in the sustainable and
renewable energy sector. We do not work in forestry, so I did not address those
issues. However, if we move toward using wood biomass as a viable large-scale
source of energy, there will be some adjustments to be made in the forestry
sector in the way we harvest trees.
Senator Mercer: Mr. Ritchie, I heat my home in Nova Scotia partially
with wood. I do not have a woodlot of my own and have to purchase the wood. In
Nova Scotia, certain woods are not supposed to be moved from one place to
another, but I have no idea of where they are. I buy my wood from the same
supplier every year. I do not know where the supplier gets the wood, so I am not
sure of the source.
Is there a website, department, phone number et cetera that we can contact to
find out about any restrictions? Many people across this country, myself
included, use wood to warm their homes. I not want to break any of these rules.
Mr. Ritchie: Your question is a good one, Senator Mercer. We have been
wrestling with this for a while because we do not have a list of certified
firewood suppliers. It is a difficult thing to regulate and we do not want to
overburden the industry. We try to increase the awareness. It depends upon where
the wood is being moved. If you are moving the wood into your fireplace, that is
fine; it will kill the bugs. How many stops it makes along the way and where it
goes is more difficult for us to control. You have put your finger on something
on which we need to continue to work with our provincial colleagues.
Senator Mercer: You must bear in mind that most of the suppliers are
small business people. In Atlantic Canada, this is a value-added business for
farmers. It is a cash crop. We cannot put too big a burden on this industry. If
firewood suppliers have to be certified, the certification must be easily
obtained and at no cost. I do not want to make this difficult for suppliers who,
in most cases, are people with a chain saw and a splitter. They may move in and
out of the business as they need cash.
Mr. Ritchie: You are absolutely right.
The Chair: We have time constraints and the next witnesses are
waiting. We also have questions on life cycle analysis, green building codes and
LEED, Leadership in Energy and Environmental Design. We will send those
questions to you in writing for your response in kind.
Senator Duffy: Mr. Ritchie, we have heard about the international
arrangements that are made to protect Canada from pests. One of our earlier
witnesses spoke about kitchen cabinet components being imported into this
country and off- gasing, that is, chemicals that were used in the creation of
the product overseas are released into the atmosphere here in Canada.
Is this an aspect of your work in terms of keeping wood safe? If it is not,
should it be? Maybe it is something you want to think about and write to us
about. It strikes me as another aspect of wood and heat treatment.
Professor Gagnon, I was fascinated by the projects that you spoke of. As you
know, the Charlottetown plant has been expanded. Do you know if these plants
economically viable? If so, when do you expect that we will see other utilities
getting into this kind of business?
Mr. Gagnon: We do not have access to the specific financials of those
units. However, when companies like NewPage and Nova Scotia Power decide to
build such plants we know that it is economically viable for them to do so.
Senator Mahovlich: Mr. Ritchie, about 50 years ago we had Dutch elm
disease in Toronto. Have the forests been replenished with elm trees? I do not
see the number of elm trees that I saw 50 years ago.
Mr. Gagnon, when will the earth start to cool, or will we ever see that
Mr. Gagnon: We know the lifetime of greenhouse gases in the
atmosphere. For example, CO2, has a life span of between 50 and 200
years. The Intergovernmental Panel on Climate Change has developed some
scenarios on the evolution of the global temperature of the atmosphere as a
function of time depending on how much carbon, CO2 and greenhouse gas
we put into the atmosphere. This is well documented.
If we want to see a reduction in temperature in the next few hundred years,
we will need to reduce our carbon emissions drastically.
At the last meeting in Copenhagen, there was a trend toward accepting
increases in the global temperature of the atmosphere, to a degree. This will
bring us to the 450 scenario, which is 450 parts per million of CO2
in the atmosphere. Most probably, that will become the global objective — to
limit the CO2 content to 450 ppm.
Senator Mahovlich: You must remember that the population increases
each year. We will need more energy. Therefore, you will have a more difficult
time trying to control the CO2.
Mr. Gagnon: Yes.
Mr. Ritchie: On the Dutch elm question, the disease is still a
quarantine disease. However, that does not stop cities from planting elm trees.
They can plant domestic elm, but we cannot import elm products into Canada.
There is still a considerable amount of planting going on to try to replace
the Dutch elm. There is active science on to try to breed a disease-resistant
elm. Some things are happening to continue the planting of elm trees in our
The Chair: Witnesses, we are ready for our second panel. We will send
you questions in writing and, hopefully, you will take the time to reply to us.
Thank you very much for accepting our offer to present to us today. You have
been informative, educational and interesting.
Honourable senators, I now wish to take the opportunity to present to you the
From the Canadian Federation of Woodlot Owners, we have Mr. Bob Austman,
From the Fédération des producteurs de bois du Québec, we have Assistant
Director Daniel Roy.
From the New Brunswick Federation of Woodlot Owners, we have Mr. Andrew
Clark, President; and with us from the Private Forest Landowners Association
(BC) is Rod Bealing, Executive Director.
We will begin with Mr. Austman, to be followed by Mr. Roy, Mr. Clark and Mr.
Bob Austman, First Vice-President, Canadian Federation of Woodlot Owners:
It is an honour to be here tonight. Thank you for inviting me.
We represent Canada's private forest owners. Most of the forests in Canada
are Crown-owned and managed on behalf of Canadians, but we are private forest
owners. We own 8.6 per cent of Canada's forestland, as you can see in the pie
graph attached to the handout. We represent nearly 500,000 families. That makes
more than 2 million Canadians who own family woodlots. About 25 per cent of
rural Canadians have a direct association with a family woodlot in their
neighbourhood in rural Canada. We own 19 million hectares of forest out of a
total of approximately 430 million hectares. If we were a separate country on
our own, we would be eighth on the list, between Finland and France, in terms of
forest cover. It is a substantial portion of the forest, and among the most
productive in Canada.
In the table at the bottom of page 1, you see that the output of timber from
private land generally exceeds that from Crown-managed forests, simply because
they are better managed by families who have owned them for multiple
generations. They have kept their eye on the trees and have monitored for
insects and fire. They have cleaned up after windstorms and other disturbances
in the forests. Generally, they are found in the southern part of Canada where
the soil is more conducive to growing healthy forests.
Besides providing timber and wood fibre, private woodlot owners supply
ecological goods and services for most settled areas, including carbon uptake,
as the professor on the earlier panel alluded to, oxygen production, wildlife
habitat, soil and water conservation and landscape beautification.
Until the downturn in the forest industry several years ago, private woodlots
supplied up to 17 per cent of the pulp logs and saw logs needed by industry, and
they generated sales of approximately $1.5 billion. These dollars were put in
the hands of rural people as a supplement to their income, whether it was
farming, fishing or other endeavours off the land. It is and always has been an
important financial asset to families.
Allow me tell you a bit about our organization. We have seven provincial
organizations including British Columbia, Alberta, Manitoba, Ontario, New
Brunswick, Nova Scotia and Quebec. We represent a wide array of woodlots and
forest types, from the Douglas fir on the West Coast to the beautiful hardwoods
in the Eastern provinces and everything in between.
We share common interests and views. The Canadian Federation of Woodlot
Owners is represented on the American National Standards Institute and the
Canadian Standards Association. We are currently working on the technical
committee to produce standards and protocols to measure forest carbon offsets,
which one day will be reviewed and possibly put into cap-and-trade programs for
carbon emissions control.
In part 3, I summarize the current status of woodlot economics. Traditional
markets have collapsed right across Canada due to a number of factors: the
declining demand for newsprint; a rising Canadian dollar, which hurts our
exports, increasing global competition from offshore plantations; forest
oversupply of wood in British Columbia due to the mountain pine beetle; and the
collapse of the U.S. house construction industry. It is, as you have read in the
media, the perfect storm. It has hit rural Canada hard. In Western Canada, the
only market that exists is for firewood. Firewood is the last remaining good
market for wood in Eastern Canada where sales from some private woodlots has
declined 60 per cent. The situation is even worse in Western Canadian provinces.
For example, in Alberta right now, because of the mountain pine beetle, large
companies are purchasing wood for 54 cents a cubic metre. That is mostly coming
off Crown land because private landowners cannot afford to sell for that bargain
Turning to part 4, assistance for woodlot owners is necessary to ensure that
woodlot owners can continue to carry out best management practices and do the
right thing to manage their family forests and keep that tradition alive
generation after generation.
The forest industry is undergoing huge adjustments, mergers, plant closures
and downsizing. The industry has a smaller profile and it means that fewer
Canadians in urban areas will even be aware of the struggles faced by rural
communities that are dependent on forestry. Nearly 600 communities across Canada
have been deemed forestry- dependent and they have been hard hit. Woodlot owners
will face reduced market opportunities and few will have the capacity to
undertake the best management practices necessary for healthy, productive
forests. For example, to undertake a thinning program will cost several hundred
dollars per hectare and it is difficult to spend that kind of money when the
revenue side of the ledger is low.
We need to encourage smaller value-added companies to serve smaller regional
markets. This could create a market for wood fibre from smaller, family forests.
This would create a similar situation to the 100-mile diet that many Canadians
have bought into. Many Canadians are buying their produce from small
neighbourhood producers only. That has been shown to be a sustainable way of
We also need to review our forest tenure system that ensures that Crown
forests are allocated to smaller forest holdings managed by communities and
community-based forests. This will provide more jobs and better value-added
We need to encourage the development of small- and medium-sized
community-based forest businesses in addition to new forest-based industries,
such as energy and biofuels, wood pellets and non-timber forest products such as
forest medicinals, and food such as mushrooms, berries, maple syrup, et cetera.
As a national organization, we have put together a shopping list. It is
getting close to Christmas; we can call it our Christmas wish list.
Turning to recommendation 1, there is an emerging market for carbon offsets
and other ecological goods and services coming from private land. Many
countries, such as Germany, Costa Rica and the United States, reward landowners
directly with cash incentives to manage their private woodlots, although there
may be other ways to compensate family forests financially for carrying out
these best management practices. The Canadian Federation of Woodlot Owners is
collaborating with the Canadian Federation of Agriculture and the Canadian Model
Forest Network to do a pilot project. I have circulated the final proposal for
that project, which is currently awaiting funding support from Agriculture and
Agri-Food Canada. We are ready to launch this program to measure the goods and
services produced by private woodlots and to set a value on them so that in the
long term, woodlot owners can look at some form of compensation for providing
these services to all Canadians.
We need federal government departments such as Agriculture and Agri-Food
Canada, Environment Canada and the Canadian Forest Service to work with us as
participants in this program, and then we need to discuss how private woodlot
owners can be rewarded for their hard work. It need not be cash; it might be
something like property tax forgiveness et cetera.
Recommendation 2 is driven by shrinking oil supplies. There is a rapid
expansion of interest in renewable wood energy, as the professor alluded to
earlier. District heat and power companies in Northern Europe and Scandinavia
are using wood in many forms — pellets, chips, stumps, even the bark from
private woodlots — to supply their heating and energy needs. The federal
government can play a key role, as we see it, in the research and development of
technologies that will lead to cost-effective community-based plants using
locally grown wood fibre as biofuel. Wood supplied by sustainably managed
private woodlots will create jobs. It is sustainable and renewable. The trees
will grow again. It would create valuable jobs in remote, rural areas.
Recommendation 3 is transitional assistance. Manitoba communities, where I
come from, such as Pine Falls have been grateful for the assistance they have
had from the Community Adjustment Fund to cope with the downturn in the forest
industry. We have lost our only mill in our region of Eastern Manitoba. These
funds can help build capacity by encouraging development of more value-added
businesses and industries that source their wood from private woodlots.
Funds can also be used to help communities diversify their economies by
promoting forest-based ecotourism. We have what all Canadians and all world
citizens want: clean, healthy forests, clean water and clean air. This could be
an opportunity to diversify our economies with hunting and guiding
opportunities, and with small sawmills and kilns and provide local wood products
for flooring and siding and so on. Non-timber forest products are currently
being produced in a number of regions, such as the blueberry plantations in Lac
St. Jean Model Forest, or the maple syrup producers in the Eastern Ontario Model
Forest program. The Community Adjustment Fund can assist in the development of
these and other local industries.
Recommendation 4 concerns access to capital. Small- and medium-sized
businesses require start-up capital. Federal grants and loan guarantees are
needed since banks and investment institutions look at new forest businesses as
high- risk ventures.
Recommendation 5 concerns certification. Family forests need assistance to
achieve certification standards such as those set out in the FSC, Forest
Stewardship Council, the SFI, Sustainable Forest Institute, and the Canadian
Standards Association. There are substantial costs associated with achieving
certification. In some provinces, government provides assistance with the cost
of certifying wood from public lands. The same needs to be done for family
forests. A key component of certification is the development of a management
plan. These can cost anywhere from $1,000 to $1,500 when written by a registered
professional forester. We would ask the federal government to provide technical
and financial assistance to help contribute to the cost of developing these
Finally, it was noted earlier in the last panel that education and awareness
are important when it comes to educating Canadians about forest pests and so on,
and we are on the same page there. The federal government perhaps can play a
role by assisting with education, training and capacity building, specifically
for family forest owners, similar to the role that Agriculture Canada plays for
Canadian farmers who educate farmers about all kinds of stewardship issues, for
example, writing manure management plans on the Prairies. This is done with
assistance from Agriculture and Agri-food Canada. No one in the Canadian Forest
Service right now is responsible for private woodlots, even though we own 8.6
per cent of the Canadian forests. Creating a research and development team
specifically dedicated to small-scale family forests would help ensure their
sustainability. It would help people do the right thing and support
sustainability and best management practices. Providing a training budget could
go a long way to help provincial associations actually do the training on the
ground and technology transfer, and again help forest landowners properly manage
their forests, which is such a precious resource on the Canadian landscape.
Daniel Roy, Assistant Director, Fédération des producteurs de bois du
Québec: Mr. Chair, I would like to thank the members of the committee for
allowing us to take part in these deliberations.
My presentation will focus on three parts. I will begin with a brief overview
of our organization and the private forest sector in Quebec. Then I will provide
an update on the forestry sector and how it is dealing with the current crisis,
and I will end with some recommendations to help Quebec's private woodlot owners
through these tough times.
So here is a brief overview of family-owned private woodlots in Quebec. There
are about 130,000 woodlot owners throughout Quebec. Private woodlots account for
approximately 15 per cent of the province's entire productive forest land base.
In any given year, private woodlots supply about 20 per cent of the forest
It is important to understand that the percentage is not quite as high today
because of the crisis, but under normal circumstances, before the crisis, very
close to 20 per cent of the timber supply came from private woodlots. Keep in
mind that 15 per cent of the land produced 20 per cent of the supply.
This productive land adjacent to plants has considerable potential for our
industry. Setting aside the current crisis, what these producers normally
contribute to the economy is between $300 million and $400 million annually,
mostly to economies in Quebec's rural communities. This sector of forest
production is extremely important to many communities.
For 40 years, Quebec has been working to improve the condition of its forests
through a variety of forest management programs. Today, Quebec has a large
network of owners who are committed to forest management and development
practices. Obviously, all that land generates economic benefits, but it is also
important to bear in mind the environmental and social benefits that it offers.
There is a great deal of focus on the economy, which is certainly an important
consideration in a family's quality of life, but given the challenges involving
air quality and global warming, the environment is becoming increasingly
important, as well. Another area of concern is water quality, because forests
are instrumental in maintaining water quality.
The Fédération des producteurs de bois du Québec, which brings together 14
producers' associations, works primarily to protect the interests of private
woodlot owners and producers. Our associations manage joint marketing plans,
which means that the act respecting the marketing of agricultural products gives
them negotiating and marketing powers with respect to lumber derived from
private producers. Our associations negotiate the sale of timber from thousands
of producers with nearly a hundred sawmills, pulp and paper mills and panel
Quebec has a network of forest consultants, who provide support to forest
owners, helping them to manage and develop their land. Professionals put
together forest plans to help owners identify the various activities that need
to be undertaken and intervene in order to improve future forest quality.
I would like to touch on the causes of the current forestry crisis. Through
its work, I believe the committee has properly diagnosed the current situation
facing the forestry industry. In its December 2009 report, the committee
correctly pinpointed two factors, which are still applicable today,
unfortunately: the collapse of the residential construction sector in the United
States and the structural decline in the demand for newsprint.
I can tell you that, in Quebec, these factors are still at work and continue
to have a tremendous impact on wood producers. As you know, the excess that
marked the real estate boom in the United States has slowed the recovery of the
construction sector. In Canada, like the United States, the construction
industry had a tendency to go through downward cycles, but the current downward
cycle is lasting even longer than usual, holding up the industry's recovery.
Wood producers have been dealing with the fallout of this crisis since 2006,
and it is hard to see any signs of recovery in the construction sector and
sawmill industry in Quebec.
Housing starts in the United States are expected to approach 600,000 in 2010,
a far cry from the peak of 2.2 million housing starts in the 2000s. Under normal
conditions, nearly 60 per cent of timber derived from private woodlots is used
by the sawmill industry. That is a huge market for our producers. What's more,
the housing crisis, which has affected many sawmills in the U.S., has led to a
significant reduction in the market share of our wood producers.
Where newsprint is concerned, there has been a considerable decline in
demand. This is not a cyclical issue, but a structural one. The advent of the
Internet and electronic media has meant that newsprint has become much less
In Quebec as elsewhere in Canada, all of this has meant the closure of
several pulp and paper plants, and also the need to convert machines. Certain
plants have not closed down, but converted their equipment in order to be able
to make other products. This has meant that wood has been used in other ways.
Producers are now being asked to provide wood chips rather than timber like
before. Another market has seen a sharp decline because of this factor.
According to experts, this trend involving the closure of pulp and paper
plants, or the conversion of equipment, should continue until 2012. It will take
that much time to achieve a better balance between the real demands of the
market — that are declining, but will eventually stabilize — and the offer,
which also has been declining, naturally, because of these closures.
Some markets have been lost. They were particularly precious markets for
producers because the pulp and paper sector uses what we call pulpwood, that is
to say lower quality wood that is used to manufacture newsprint pulp. When
development is being done in private woodlots, that type of wood is often
generated because we are attempting to improve our forests. The lower quality
wood is taken out in order to keep higher quality wood that has better growth
perspectives and a more interesting development horizon. So the loss of that
market is currently a serious problem.
As to the effects of the crisis on Quebec forestry producers, you have here
three graphs that illustrate rather well the impacts on producers since 2005. It
would be more interesting if the curve were going in the other direction, but we
are witnessing a sharp decline in terms of the volumes of product being sold.
Normally, we had a market of close to six million cubic metres of wood per year.
In 2009, we closed the year with less than three million cubic metres. That is a
drop of over 50 per cent in marketed volumes.
Because of this drop in demand, of course prices have been following the same
curve. There was a serious average decline in wood prices in Quebec and all of
that translated into a loss of income. We went from close to $300 million in
2005 to $120 million in 2009. From 2006 to 2010, we estimate that the gross loss
of income was greater than $500 million for our producers. The producers who
derive an important part of their family income from wood production were forced
in many cases to sell certain forest properties they had or to sell equipment in
order to survive the crisis. In some cases, they simply shut down all of their
operations. They changed sectors because it was too difficult to survive.
A lot of private forest producers in Quebec do this work on a part-time
basis. For many of them this represents supplementary income. However, that
extra income for many was important income in terms of their total family
business income. These sorts of things can destabilize their business. I am
thinking of certain farmers, among others — a lot of our producers are farmers —
who derive a part of their income from agriculture but round things out with
their forestry activities. Their family business was made more precarious by
My last point is perhaps the most important and concerns the expectations of
the Fédération des producteurs de bois du Québec.
In the past the federal government intervened to encourage forestry producers
to develop their forest. In the mid-90s there were federal-provincial agreements
that allowed the federal government to support forest owners in carrying out
silvicultural projects through various programs. More recently the federal
government came to the assistance of producers who were grappling with the
current forestry crisis. Through the community adjustment fund there was an
injection of $10 million in 2009 into Quebec silvicultural programs for our
forest owners, and $5 million was provided in 2010. Normally, this financial
assistance is to come to an end on March 31. For the organization and for our
woodlot owners, this assistance was precious. In this period where producers are
selling less wood, the possibility of going to work in their forest
nevertheless, to improve its quality through various silvicultural projects
thanks to these programs, allowed them to generate a certain amount of income.
This income replaced the loss of income they suffered due to the decline in the
wood sales. So this has been an important mechanism to help the communities get
through this crisis that is ongoing at the current time.
As an organization, we would like to see this program extended for at least
two years, which would give us time to assess the crisis. As we speak, producers
expect that they will receive assistance to get through the current crisis.
The other advantage of these programs, in addition to providing employment
and allowing people to draw an income, is that they contribute to improving
forests for the future. That is an important element — you also highlighted this
in your work previously. We have to work on improving the quality of our forests
and trees in order to better position our industry for the future. The private
forest has great potential. It is close to the mills, and the ground these trees
are planted in constitutes a very productive environment. And so there is a
potential there, and it will be to everyone's benefit to develop it and invest
The other measure we would like to see — and this is more audacious — is a
fiscal incentive to assist owners in developing their forest. Over the past few
years, what has been called a silvicultural savings and investment plan has been
developed. This is a proposal which urges the federal and provincial governments
to put in place an investment regime where the owner of a forest could put the
income derived from the sale of his wood in a tax-protected account in order to
be able to use it subsequently for the development of his woodlots. It is
comparable to a forestry RRSP. These sums would become taxable upon withdrawal,
but the advantage is that the owner could have a source of income at the precise
time he wishes to spend to develop his woodlot. From the fiscal point of view,
this would be more advantageous for the producer than the current situation
which is that he is taxed when he sells wood. He does not always have
expenditures that arise at the same time as he is cutting down the trees. The
investment and development expenses may occur in the three or four subsequent
years but then he no longer has the income to balance his expenditures and
income from the fiscal point of view.
Such a plan was detailed in another document we distributed which is entitled
Stimulating the development of rural communities through the creation of a
personal silvicultural savings and investment plan. The document is very
detailed, I am not going to go through all of its contents but I invite you to
acquaint yourselves with it. It answers a lot of questions. We would like the
government to consider this plan seriously for the next budget.
Andrew Clark, President, New Brunswick Federation of Woodlot Owners:
The New Brunswick Federation of Woodlot Owners wishes to thank you for your
interest in our sector. As part of the Canadian federation, we endorse the
recommendations that the federation has made.
I would like to address a few comments from New Brunswick's perspective. The
markets for private woodlot wood in New Brunswick have fallen by 60 per cent in
the last two years, due to mill closures and shutdowns. There is an initiative
to correct our lack of market opportunity under way in New Brunswick; however,
we need to develop new uses for wood. Some of our members have actually taken
the initiative to develop some new industries.
The problem we have in common is a lack of available and reasonably priced
capital. The Farm Credit Canada has been helpful, but there is a need for a
larger pool of capital willing to take some risk in order to develop wood, as I
believe we are capable of doing, and to use more of it.
There are some new markets that are asking for certified wood. There are
standards, as Mr. Austman alluded to, out there now, and they are rather costly,
anywhere from $1,000 to $1,500 per woodlot to get developed.
In the past, the federal government did support programs that helped with
some of these costs. The federal government could play a role, either in new
federal-provincial agreements or by using tax credits in the reform of
refundable tax credits. There is also a need for a national coordinator to see
that the maximum benefit is derived from the efforts now taking place in Nova
Scotia to use the CSA Z804 standard that is being tried. It is also being worked
at in Northumberland in New Brunswick, and there are initiatives in Quebec and
Ontario on the Forest Stewardship Council.
My belief is that there is much overlay in preparing woodlot owners for
certification, whether it is carbon credits or environmental goods and services.
There is a need for a national coordinator or secretariat to help in the sharing
of this information so that we do not continue to reinvent the wheel.
I would like to make two points on tax policy as it affects private woodlot
owners. First, the Canadian federation asked for the creation of a registered
silviculture investment plan. Such a plan would help owners deal with cases
where ice storms, insect infestations, tornadoes et cetera should strike a
woodlot that would require a great deal of money to repair. It would allow
owners to park some of this money to use later to re-invest in woodlots for
planting or reforestation efforts.
Another thing in tax policy is income supports for senior citizens as they
now exist are in all too many cases a deterrent to sensible use in the
management of woodlots. The guiding principle for income support should be for
the care of the resource, not for maximum tax collection. That is a change in
mindset, I would say. If you talk to the people at the Finance Department, as I
have had the privilege of doing a couple of times, they focus on ensuring the
taxpayer pays. I am telling you to start focusing on seeing how the resource is
Resources for industry and jobs for workers are sometimes lost. In the New
Brunswick context, a few years ago rules that affected how seniors made their
contributions to special care homes were changed when the government realized
that they were working against good forest management, that people were not
doing what they needed to be doing. In analyzing the situation, they changed
that. My point is that all of our tax initiatives and policies need to be
examined carefully, not only for their intended purposes but also for their
unintended consequences, because there is always the other side to things.
The Canadian federation worked for many years to get a principal established
where private woodlots could be rolled over to the next generation the same way
farms are with deferred capital gains. That is an example of good work that has
been done and we need to do more of that.
The invitation asked for ideas to promote good forest management. What do you
mean by good management? Clear- cutting, planting, and thinning are all forest
management techniques, but it is even-aged forest management. I think what you
were referring to could be called uneven-aged forest management.
In that, you would be working to keep at least partial cover over your
forested land. You would be working with naturally occurring species on the
landscape. You would be working to protect water sources, not just watercourses,
and there is a difference. You would also have within your plans protecting
species at risk and things like that, and you could go on and on in defining
this. I simply want to make the point here that if we are to talk about policies
to encourage good forest management, we first need to define good forest
In New Brunswick, from 1978 to 1996 we had federal-provincial agreements that
allowed for support not only for the thinning and planting that was taking place
and still takes place there under provincial programs, but we were allowed some
flexibility to use some of the money for planning as well. We need those
agreements again in the effort to renew our forests for the future.
The federal stimulus money that New Brunswick received from 2009 to 2010 has
helped to maintain employment for hundreds of our people and continued support
is needed. For forestry in New Brunswick, the recession is not over. We still
need that support.
In closing, senators, I urge you to use your influence to guide the federal
government to take a leadership role by good tax and incentive policies, by
again helping woodlot owners directly, by supporting silviculture, management
plans and creating a common pool of information, to help woodlot owners make
good decisions. Why? The answer is because water and air flow across provincial
boundaries and international boundaries. Next to food and shelter, water and air
are absolutely essential for our survival as a species and for the world.
Watercourses that start on private woodlots become drinking water for many
villages, towns and cities. The air improved by the trees on private woodlots
adjacent to most towns and cities, or close by, purify and take away some of the
pollution that has been generated within your towns and cities. How they are
being handled is important to society, not just to the woodlot owners. Whether
they realize it or not, everyone has a stake in supporting good forest
The Chair: Mr. Clark, thank you very much. As always, you are precise
and to the point.
Rod Bealing, Executive Director, Private Forest Landowners Association
(BC): Good evening and thank you for the opportunity to speak with you
today. The Private Forest Landowners Association represents private forest
owners in British Columbia. We endorse the recommendations of the federation
here today. There are many common goals and observations from the four of us.
I have provided a presentation. Rather than grind us all through it, I would
like you to enjoy it in your own time and use it as a reference for some of the
points I am trying to make. It has some statistical information in it.
I would like to talk a little bit about your interim report. I took the time
to read it and I was encouraged. I have been involved with many processes like
this over the years, and I was encouraged indeed. This is a committee that gets
Senator Eaton: Flattery will get you everywhere.
Mr. Bealing: That is what I am hoping, but it is only part of my
strategy. There is more to come.
I noticed on four separate occasions your recognition that it is important to
encourage competition for fibre; that it is not all about getting delivered log
costs down, which is not the solution to Canada's ills. It is a bit like a sugar
high, so convenient just after Halloween. You give the kids candy. They run
around and next thing you know they are falling over and screaming and you
wonder why you did it.
On pages 6, 25, 35 and 46 the report recognizes that it is important to
ensure there is a good return of value to the forest, that the person who has
taken all the risk, and Lord knows we know who they are, paying the property
taxes, putting out the fires, dealing with the blowdown, the trespass, all these
challenges we have, we need some return for our risk. A policy that restricts
log prices, that makes it difficult to get good value for our logs, makes it
difficult for us to sustain our businesses.
This is where we get into best management practice and what government can
do. We need to send a signal — the government needs to send a signal — if Canada
believes that forestry is an important thing and something we should encourage.
What kind of signal do you want to send the landowners? What kind of signal do
I am a forest owner, and from time to time, when I see an opportunity in the
market, I will harvest some trees. A number of times I have sat down with my
family and discussed the fact that we will get some revenue for some logs now.
Do we replant? Let us think about that for a minute. What kind of assurance do
we have that if we put trees in the ground now that we will actually be able to
go back and harvest them when the time comes? Maybe if we do nothing, we will
get more support. Maybe we will get a better property tax treatment. Every
forest owning family goes through this process each time the family thinks about
whether they should replant after they harvest.
It is important that we be remembered as farmers that happen to have crops
that take a long time to grow. We need to think about some of the things that
government does to support farmers. It is a no-brainer. Look at how farmers are
Without going through a tremendous amount of detail and putting you through
my entire presentation, although it is entertaining and I encourage you to look
at it; my requests today are straightforward. I like to think of them as quite
easy, low-hanging fruit for the committee to recommend.
First, maintain some distinction for private land. This is through policy
development. I am trying to focus on Canada rather than the work we do in
British Columbia. When Canada is developing new policy, particularly Environment
Canada or Fisheries and Oceans Canada, I want everyone involved to remember that
there is a difference between public and private land. These private owners are
taking a tremendous amount of risk. We have shown across the country that we
recognize that we need some balance. This is an exercise that we have done in
our association since 1997. It is our Best Management Practices program. I only
brought one handbook today, but I will leave it with you and I can provide more;
As owners, we realized that there are environmental values on our land that
the public is interested in, and we need to demonstrate that we take those
things seriously, that we understand that our neighbours have needs in terms of
water quality, fish habitat, critical wildlife habitat, et cetera. As
independent and keen we are on private property rights on our land, we recognize
that there is a public interest in what we do on our land. The question then
becomes more about finding some balance, namely, balancing our investment and
our private property rights with the interests of our neighbours and our
communities. Balancing environment, community and commerce is the juggling act
we all must do on private forest land. That is something that we need staff in
the ministries to understand. We get it. We are not an unregulated bunch of
pirates out there not thinking about our land. We have an interest in our land.
We care deeply about our land.
The second thing I would like to strongly recommend — and this is exclusively
a British Columbia thing — is that we need open access to international log
markets in British Columbia. Currently, the federal government restricts our
ability to access those markets. It is the only province in Canada where the
federal government restricts market access, and it has a huge impact on our
I return to the question about what Canada can do to help best management
practices and sustainable forest management. Here is an example where, by taking
away this restriction or even modifying the way it is administered, would have
the effect of taking a foot off our throats. There is revenue out there; we have
overseas customers that are prepared to pay a better dollar for our wood, yet we
are restricted by this policy that no longer serves anyone or has any value at
all. I go into detail about that in my presentation. I would welcome the
opportunity to talk to the committee further on that subject, which is huge for
Third on my list is engage and involve owners. Again, this goes to what some
of my colleagues are saying. Through education and communication, it is about
that two-way traffic. I do not know how many generations we are now removed from
the farms and the forests in the cities. It is probably five or six; I have lost
count. However, policy is made in the cities, and forest owners and farmers tend
to keep to ourselves. If we do not bridge that gap both ways by making an effort
to communicate, we will get more policy that does not work for anyone. That is
something that we believe strongly, namely, keep that communication going. That
is one of the reasons I am here today.
Finally, my fourth recommendation you already have in my report. Encourage
that a fair portion of the value goes back to the land. If we do not respect the
land, and if we ignore the forest, we will not have an industry. We will not be
able to attract processing plants or mills or things that add value to wood
because people will not be able to afford to take care of their forests.
Senator Mercer: Gentlemen, thank you very much for the interesting
Several of you have talked about certification. Our previous panel talked
about certification with respect to the cutting and marketing of firewood, which
is a concern. Why does it cost $1,000 to $1,500 per woodlot to do? Where does
the cost come in? Who gets the $1,000 to $1,500?
Mr. Clark: I am a forest technician. If you want a proper plan, it
requires you to go out in the forest and walk along in a predetermined pattern,
taking samples to determine the standing volume and the age and health of the
forest. You then draw that up and create a map of it, delineate the different
stands on the properties, do up a proper report and produce it for the owner. It
takes quite a bit of time to go out and do a good forest management plan because
a forest management plan looks at everything, for example, the type of soil you
have and the drainage aspect. Many things need to go into it to do it properly.
Senator Mercer: If I wanted to certify my woodlot, I would bear that
cost of $1,000 to $1,500 myself. Is there no tax advantage? Obviously, it is a
business expense but are there any business programs across the country that
offer incentives to get this done, possibly as a direct subsidy from a
provincial government? Of course, we cannot say that dirty word ``subsidy''
because some American might be watching us, and I just got the entire industry
in trouble. Is there no program that helps get us to this point?
Mr. Austman: The short answer is no. The forest management plan for
$1,500 is just step one. For certification, we are looking at regional
certification where a number of woodlot owners would be certified as a group. In
some areas, we are looking at hundreds of thousands of dollars. The scale is
ramped up to a much larger scale when you want to get the certification from
FSC, SFI or CSA. For an individual woodlot owner, it would be out of the
question to have one family forest certified. We are talking about a regional
basis, and everyone would chip in. The standard would be audited from time to
time to ensure that you are doing the right thing on the land. If you do not,
you will lose your certification and lose your market access.
Senator Mercer: Is Crown land certified?
Mr. Austman: Bits and pieces of Crown land are certified. Right across
the country, I think about 30 per cent of our Crown land is under FSC. That is
the number one certifying body in Canada.
Mr. Roy: In Quebec, within the context of the development programs I
was referring to earlier, the financial assistance measures for silvicultural
work allows private forest owners to partly finance their development plans.
Those programs are also used to fund development plans, which is the first step
in the development of a woodlot if you are going to come to the assistance of an
owner. And so, indirectly, this helps with certification as the development plan
is a crucial tool at the very heart of any forest certification process. And so
access to this type of financial assistance is one way of helping forest owners
obtain forest certification.
Senator Mercer: Senator Fairbairn, Senator Segal and I have heard many
times when doing various studies on the agricultural industry about the need for
improved succession planning and making it as easy as possible for a farm to be
passed down to a family member without a huge tax burden.
If we were to duplicate what is currently in place for the transfer of farm
land, although we know that is not perfect, for the passing down of woodlots,
would that be sufficient, or is there something more we need to do to provide
for succession planning?
Mr. Clark: As I said in my remarks, we currently have that in large
measure. In order to qualify for that you must have a management plan to
demonstrate that the land you are passing on will be used properly. It is called
Senator Mercer: Is it the same in agriculture?
Mr. Roy: It is similar.
Mr. Clark: To your point on costs for management plans, I was thinking
of that when I talked about refundable tax credits. A private woodlot owner
without a large income might be able to claim it as an expense, but if you do
not have enough tax payable it is not really a benefit to you. A refundable tax
credit is a benefit and would encourage you to go ahead.
Senator Segal: I want to probe something that came up in the work that
Senator Mercer referenced on agriculture. When we looked at our European
competitors, we saw that in many European countries stewardship fees were paid
to the farming community as part of the environmental maintenance process, which
supplemented other income from the farms.
I have heard this afternoon from some of you the suggestion that there should
be some compensation beyond what is now in place for private woodlot owners who
are maintaining an important part of our environmental heritage by virtue of the
work they are doing thinning and maintaining their woodlots to protect them from
fire and infestation.
Have you thought about the kind of structure you would like to see for that
kind of stewardship fee? Would it be tied to acreage under ownership? One
suggestion was an enhanced refundable tax credit. That is a mix of federal and
provincial jurisdiction, by definition, because of who has control over land and
natural resources in the provincial area.
I would be interested in any advice you might give the committee on specific
recommendations we could make in that area to provide a base income for woodlot
owners to help defray costs in thin times so that they are able to survive until
Mr. Clark: In some provinces there is a move toward conservation
easements under which payments are made so that owners will not clear-cut
property that is protecting some water, for example.
Senator Segal: An environmental right of way?
Mr. Clark: Yes, the City of Moncton interacts with nearby woodlot
owners in that way. New York City pays woodlot and other landowners in upstate
New York quite a lot of money to protect their water supply.
I alluded to that principle. There is a societal interest in having this
done, but currently all the cost and responsibility for that rests with woodlot
owners. Mechanisms need to be developed to recognize that and transfer money for
the benefit provided.
Senator Segal: Will some things work better in British Columbia, for
example, and others in Quebec? Are there nuances of which we need to be aware?
Mr. Bealing: Possibly. A challenge we have in British Columbia is that
there is not much private land. As you go further west, there is much less
private land. Although we tend to be in people's back yards, we are in the
lower-lying lands. There are non-timber uses for forest land such as camping,
hunting and fishing, but there is so much of that available on Crown land that
it would be very difficult to compete.
The government could provide payment for those goods and services, but
ownership of the resource drives the matter more than anything else. I cannot
imagine that the committee wants to go there, but in European countries and the
U.S., owners have the ability to sell fishing or hunting rights. Those things
are huge income generators for forest owners. In Canada we have our hands tied
behind our back in that regard.
Mr. Austman: In Manitoba, we have the Alternative Land Use Services
pilot project north of Brandon. Land owners are paid $75 per acre per year for
water stewardship, for not bulldozing little woodlots to raise cattle, for
leaving grass waterways that reduce erosion, for planting trees, et cetera.
There is a management plan involved. No one will get rich on that amount of
money, but it is an incentive for those who are thinking about bulldozing down a
10-acre woodlot to use the land for fattening steers for market.
The $75 is the tipping point to get people in on the program, and it has been
Senator Robichaud: Mr. Clark, you have a Federation of Woodlot Owners
in New Brunswick, do you not?
Mr. Clark: Yes. Seven regional marketing boards are members of the
Senator Robichaud: Is the board the authority on certification that
will help woodlot owners go through the process?
Mr. Clark: There have been a number of different tries at this. The
former industry in the Miramichi was offering woodlot owners a bonus payment for
their wood if they followed programs. They wanted their owners to become
certified because Time Warner wanted to buy only certified wood. The driver for
that was coming from the marketplace. That marketing board was actively
supporting that and providing information to their owners to get them up to
speed with the program.
We have worked at this in different areas at different times. Northumberland
is working to develop a new industry, a pellet mill, with a Dutch partner that
wants the wood to be certified. The Dutch government is willing to spend money
to ensure that the wood that they are getting is certified. They want it to be
sustainable because they want to switch their coal plants to wood, so there is
There is a connection between markets. The price of carbon is starting to
affect the interplay. I recently hosted a university class on my woodlot for a
few hours and I was asked about certification. I told them that it will be
market driven in the end. That may be through carbon credits, environmental
goods and services or simply customer demand. Once the push is there the steps
will be taken to make it happen on a large scale.
Senator Robichaud: Do you feel that we are near?
Mr. Clark: Yes, I do. At the last federation board meeting the manager
of the North Shore board reported to me that he wants to sell wood to the Shaw
factory that is producing pellets. They told him they needed certified wood
because they were selling to a European market. That is another demand coming in
We are starting to see this interplay and the demand is coming from Europe
largely, where they have a functioning carbon cap-and-trade system. It becomes
in the interest of operators of utilities to ensure that they become carbon
neutral, if they can.
Senator Robichaud: The cost of certification is at the woodlot owners'
expense, is it not?
Mr. Clark: Yes, unless one of the industries is willing to put some
money in to support it.
Senator Robichaud: What is an average lot size of a woodlot owner in
New Brunswick by hundreds of acres?
Mr. Clark: They are about 100 acres, on average. They range anywhere
from 20 acres up to 1,000 or 2,000 acres. The average is 100 acres.
Another thing about society's interest in this, with good management and
intergenerational change, the average woodlot stays in one person's ownership
for about 20 years. That is a short time in the life of a forest.
If we think in the life of a forest being in 80-year cycles, at least in the
New Brunswick context, then you need to be thinking in the longer- term with
policies that support long-term thinking and that rewards the practices that you
Senator Robichaud: Whatever wood is produced in the province or is
extracted from the forest, a certain percentage of that must come from private
woodlot owners, does it not?
Mr. Clark: We had rules in place that said, basically, the annual
allowable cut at one time from the private woodlot sector had to be purchased
before industry's access to Crown wood. In the last few years, that has become
reversed. In the 1982 act, it was envisioned that the Crown would become the
residual supplier. Now it is the private woodlot owners that are becoming the
residual suppliers; they are cutting all of their Crown land, and we are working
diligently to try to get that corrected.
There is an initiative under way. Last year, we harvested only 600,000 cubic
metres out of 2.5 million available cubic feet, and this year we have a target
of 1.1 cubic meters, which the provincial government is supporting by cutting
back some Crown availability. Yes, we do have a problem there that needs to be
The Chair: I have a quick question to complete remarkable
presentations. Would that wording be ``primary source of supply?''
Mr. Clark: Yes. That was the doctrine when Bud Bird first introduced
that act. He wrote to the executive director of the Forest Products Association
of Canada of the time, and said, ``The private woodlot owner must perceive their
future with optimism.'' Basically, he was telling the industry, ``I know you do
not like this deal, but that is the way it is, so live with it.''
Senator Duffy: Is the same wood certification process in place right
across the country?
Mr. Clark: It is available.
Mr. Bealing: Actually, there are a number competing for increasingly
similar processes for forest certification. Canada has more certified forests
than any other nation on the planet. It is way up there. However, there are a
number of certification systems in place. They are very similar.
Senator Duffy: How detailed does it become? We have had witnesses from
the softwood lumber industry who say it is now down to the point where every
what they call stick of lumber that is harvested has a unique number and they
know it. Are small woodlot owners now expected to meet that level of detail?
Mr. Bealing: From the British Columbia perspective, we have a timber
marking system required by law, so you cannot send logs off your property unless
you have marked them. That is a good fit with a chain of custody process.
This is a customer-driven process. The customers demand some assurance that
their two-by-fours or paper comes from a sustainably managed source. There has
to be some connection there right back to the stump. It is pretty impressive
Mr. Roy: In Quebec, we have in the course of the past few years
developed certification processes for forest owners' practices. This work is
ongoing. The process is more advanced in certain regions of the province of
Quebec. These systems provide for wood traceability, they allow us to follow the
wood. This function is included in the owners' certification process. Thus, we
will be able to follow the wood from the stump, from the forest to the mill, for
the purpose of meeting buyers' eventual requirements. This capacity has been
integrated into these systems.
Senator Duffy: How big of an impact did that have or is this having on
your members? We hear about $1,500 per woodlot. Are we finding people simply
unable to raise that kind of money?
Mr. Clark: My answer to the forestry class was, until someone is in my
particular area, no one is asking me for certified wood. Until someone comes
along and says to me, ``I need certified wood if you want to keep selling me
wood,'' why would I, as a woodlot owner, spend the money? I do not have to
change any practices on my woodlot. It is my woodlot, and I know it is managed
to a good standard. I do not have to change anything, but in order to go to the
expense or bother writing a management plan, give me a reason.
Senator Duffy: Do we have inspectors who go around checking this?
Mr. Clark: If you enter into this, as Mr. Austman was referring to,
individual owners need a management plan, then you will need them in groups, and
the Forest Stewardship Council will do an audit. You will have to pay for the
cost of the audit. That is where the big money comes in. You know what it is
like to get an audit on your taxes? We get auditors in on these management plans
for a large area, and they are very expensive.
The Forest Stewardship Council is international environmental group driven
and has stringent standards, for the most part. The Z804 is a CSA standard that
has been developed with the cooperation and help of the private woodlot owners
in Canada as trying to find a standard that is more reasonable to work with yet
meets international requirements. We are in the process of having that tested in
Europe to see whether it suits them.
We do not yet have that answer, I guess. If we get it approved in Europe so
they will accept the Z804 CSA standard as being good enough, then we will have
one that we can more easily work with in private woodlot sectors.
Senator Duffy: Do the Americans have the same obstacle?
Mr. Austman: Yes. They have the American Tree Farm System, which they
got from us and they hung the American name in front of it. Essentially, they
are using our system, we brought it back, dusted it off, revised and tweaked it
and that formulated the framework for the CSA Z804 Standard.
Senator Duffy: In comparative and competitive terms, they are in the
Mr. Clark: Yes.
Senator Segal: Except for the absence of Crown land.
Senator Duffy: In terms of the costs of managing a woodlot —
Mr. Roy: Insofar as the cost of certification is concerned, in Quebec
we have chosen a collective approach. Rather than letting producers shoulder the
whole cost, we have included a larger number of owners in the process so as to
reduce the costs related to planning and administration, among other things.
This has allowed us to reduce the burden for each individual involved. However,
this approach has its limits, and they are related to the financial capacity of
the organization, in spite of involving all of the owners in the financing. It
is a very costly process. Without some form of support from the state to develop
this certification process further, we will not be able to move forward quickly.
The Chair: We have gone far beyond our allocated time. We will have,
no doubt, other questions that will follow. We will submit them in writing to
you and you can send your answer back to us.
We want to thank you for your informative answers.