Natural Resources Committee on Nov. 20th, 2025

[The Chair, Liberal, Terry Duguid]

I'll call this meeting to order, acknowledging that we are meeting on the unceded territory of the Algonquin Anishinabe nation.

Good morning, everyone. This is meeting 14 of the Standing Committee on Natural Resources. Today's meeting is taking place in hybrid format, pursuant to the Standing Orders.

I have just a few comments to start for those participating by video conference. We'll have folks online in the second hour.

Click on the microphone icon to activate your mike, and please mute yourself when you are not speaking. At the bottom of your screen, you can select the appropriate channel for interpretation: either floor, English or French. For those in the room, you can use the earpiece and select the desired channel.

This is a reminder that, as always, all comments should be addressed through the chair.

Colleagues, I can confirm that the minister will be attending the next meeting of the natural resources committee. I know he's looking forward to it, by all accounts. The first hour will be the minister; the second hour will be officials. I know we all look forward to that.

Colleagues, last day I prematurely retired our clerk. She assured me she is not retiring. She is moving on to her next assignment, but I think you'll agree that we have been incredibly well served by the staff here. She will be with us until we break in December.

Thank you, Geneviève, for all the work you do.

[Some hon. members]

Hear, hear!

[The Chair, Liberal, Terry Duguid]

It's a sitting ovation.

Pursuant to Standing Order 108(2) and the motion adopted on Thursday, September 18, 2025, the committee is resuming its study of the forestry industry.

I'd like to welcome our witnesses on the first panel in the room. From the Canadian Wood Council, we have Rick Jeffery, chief executive officer. From the City of Campbell River, we have Mayor Kermit Dahl.

Welcome. You will each have five minutes or less for your opening remarks.

Mr. Jeffery, you have the floor.

[Rick Jeffery, Chief Executive Officer, Canadian Wood Council]

Thank you, Mr. Chair and members of the committee, for your invitation today.

The committee's mandate and work reflect your recognition of the importance of the forest industry in Canada. We are facing unprecedented challenges, and I hope today to highlight significant opportunities that can assist in addressing these challenges.

I'd like to start by thanking all parties around the table for your engagement and support of Canada's forest product sectors, their employees and the communities across the country that rely on the forest sector for their health, quality of life, economic livelihood and prosperity. I've been in the sector for over 40 years, and there's no better place to dedicate my life. The people are truly amazing.

My remarks today will focus on three main topics: the importance of wood as a material in housing construction and in achieving carbon neutrality, objectives and targets; the federal government's role in domestic market diversification opportunities and development of new products and systems to improve the industry's competitiveness; and, finally, public procurement policies that promote the use of wood products.

I will not touch on things that are outside of the Canadian Wood Council's remit such as U.S. trade and tariffs, interest rates, financing for affordable housing, infrastructure, zoning and permitting, or taxation and development charges, all which affect housing in Canada.

For a little bit about the Canadian Wood Council, our mission is to advance domestic wood use in Canada. We are a national federation representing wood manufacturers across Canada, including lumber, panels, trusses, engineered wood products and treated wood. We have partnerships with home builders, mass timber companies and the architect, engineering, construction and development communities, among others. We work closely with NRCan, the Natural Research Council, the Canadian harmonized code committee, universities, provincial and territorial governments, municipal governments and indigenous governments on the appropriate role of wood in construction.

The CWC is a unified voice advancing codes and standards and market access. We promote sustainable wood-based construction solutions that pursue a vision of Canada where a strong sustainable wood market supports a vibrant culture of wood.

At the heart of our mission is a commitment to advancing the use of wood across Canada's built environment. Our efforts are anchored in three core focus areas: market access, market development and technical education and outreach.

The first theme I'd like to talk about is the importance of wood as a material in construction. Canada faces a housing affordability crisis. The committee knows, should know, I'd like you to know, that the most affordable and livable housing typology that can be built in Canada is a light wood frame mid-rise, five- to six-floor apartment building. This building type is based on the most prevalent wood products that we produce, lumber and panels, thereby supporting our existing industry. They are scalable and can be rapidly deployed. Their design is flexible and thus able to provide livable two- and three-bedroom units that are suitable for families and are in dire supply today.

It is a known building typology, so permitting and approvals should not be held up by building officials. They are adaptable to the flavour of the day, which is modern methods of construction. When I say modern methods of construction, I'm talking about industrialized construction, panelization, volumetric modular, modular, mass timber and all of these kinds of things. These are the new types of construction beyond how we have traditionally built housing in Canada.

As we get more familiar with mass timber construction, we're now seeing that mass timber buildings in the seven-floor to 18-floor range are cost competitive to other structural materials and even more cost competitive if you take into consideration the cost savings that are due to the fact that these buildings go up much faster than traditional construction techniques.

The CWC estimates that, by increasing both wood-based residential housing starts and non-residential markets, we can increase domestic consumption of Canadian lumber by two billion board feet. That's 10% of Canada's lumber production and represents a big market diversification opportunity right here at home. It is our biggest diversification opportunity. Wood-based systems are key low-carbon solutions to solving Canada's housing crisis.

Here is what the government's role could be in domestic market diversification.

The Canada Mortgage and Housing Corporation estimates we need 3.5 million more houses to meet our affordability targets. That means we have to increase housing starts by 250,000 units a year. In order to do that and to address that affordability gap, as a nation, we need to augment traditional methods of construction with modern methods of construction to assist in meeting this goal. Wood-based systems are some of the most cost-effective and scalable options for modern methods of construction.

There is currently a base of some 850 companies in Canada involved in industrialized construction. Catalyzing them to increase their capacity will be critical to increasing housing starts. Connecting primary wood products manufacturers with industrialized construction manufacturers is a large part of the solution to realizing the benefits of modern methods of construction.

[The Chair, Liberal, Terry Duguid]

Mr. Jeffery, I'll ask you to wrap up. I've already given you some extra time.

[Rick Jeffery]

Sure.

There are a number of ways that government can help.

There's the softwood lumber support package with critical programs in there that can advance this. There's the strategic response fund that can assist in helping us retool to meet this challenge. There are supports that can be used to help us train the people in mass timber and those kinds of things. Then, Build Canada Homes needs to create a pipeline, de-risk investment, fix procurement and payment approaches and facilitate retooling of sawmills. Finally, a buy Canadian policy needs to have wood construction as part of its procurement.

[The Chair, Liberal, Terry Duguid]

Thank you very much, Mr. Jeffery.

[Rick Jeffery]

You're welcome.

[The Chair, Liberal, Terry Duguid]

We'll go on to Mr. Dahl.

You have five minutes or less.

[Kermit Dahl, Mayor, City of Campbell River]

Thank you, Mr. Chair and members of the committee, for the opportunity to speak today.

My name is Kermit Dahl. I'm the mayor of the City of Campbell River, on northern Vancouver Island. I also serve as chair of the Campbell River business advisory team, originally formed in response to the U.S. tariffs, but now a strong voice for natural resource communities. In addition, I represent the Alliance of Resource Communities, a coalition of municipal leaders advocating for sustainable resource development and highlighting how provincial and federal policies are impacting investment and jobs.

Campbell River is the forestry hub of north Vancouver Island, supporting a significant share of harvesting operations. Our community feels every ripple in the forestry sector, whether it's growth or decline. Unfortunately, across British Columbia, we are witnessing a systemic dismantling of a once-thriving industry. Ten years ago, forestry contributed roughly $1.5 billion in stumpage fees to the provincial government. Today, that figure has fallen to about $550 million, as reported in the 2024-25 provincial budget.

The coastal allowable annual cut, which was set at 14.4 million cubic metres, has seen harvesting of just over 4.5 million cubic metres to date. The provincial allowable annual cut follows a similar sharp downward trajectory. Both economics and provincial and federal policies have been identified as the chief causes of this lack of harvesting.

Since 2018, nine coastal mills have closed. This loss of capacity is driven by a combination of significant provincial and federal policy constraints, U.S. softwood lumber duties and recent section 232 tariffs, all of which have weakened competitiveness and investor confidence. Since 2022, the forestry sector has lost roughly 5,400 jobs, yet 40% of coastal pulp mill fibre is now being imported from the United States due to a chip supply shortage created by eliminating many of the mills in our coastal area.

This is not just an abstract issue. It affects real businesses and families. In my own company, when harvesting slows, revenue drops dramatically. It impacts local spending and community stability. When a contractor can't keep his crews working, those families face uncertainty, and that uncertainty ripples through every sector, from retail to housing. These are not statistics; they represent livelihoods, mortgages and futures.

Forestry isn't the only sector facing challenges. Mining, energy and aquaculture are in the same situation. Companies are dealing with too many overlapping rules, long and unpredictable approval processes and rising costs that make it hard to invest. Aquaculture businesses worry about whether they'll keep their licences and about new federal rules that create uncertainty for coastal communities.

These delays aren't about protecting the environment. They're about complicated bureaucracy and unclear decision-making. Indigenous partnerships, which should be central to development, are slowed by confusing jurisdictions and inconsistent consultation, leaving communities frustrated and opportunities lost. Meanwhile, other countries, like those in Scandinavia, South America and the U.S., are moving faster and are attracting investment and skilled workers. Every month of delay means fewer jobs, less tax revenue and less confidence in Canada's ability to compete globally.

The 2025 federal budget includes welcome commitments of $1.2 billion to forestry infrastructure and $13 billion for construction. However, in British Columbia, uncertainty around fibre access and regulatory instability means companies may hesitate to invest. Our province could lead Canada's economic renewal through forestry and other resource industries, but that requires coordinated federal-provincial leadership to restore confidence. Without that alignment, these federal investments risk being underutilized, leaving communities like mine without the opportunity to benefit from national growth initiatives.

British Columbians overwhelmingly support responsible resource development. To sustain that trust and to strengthen the strategic industry, we need progress on four fronts.

We need a fair, long-term softwood lumber agreement with the United States to reduce uncertainty and to stabilize trade.

We need streamlined regulatory processes that maintain high environmental standards while eliminating duplication and delay. Right now, companies face overlapping requirements that add cost without improving outcomes.

We need timely and accessible federal support to stabilize operations and attract new investment. Programs must be designed for speed and clarity because when mills close, communities don't have years to wait.

We need to help local economies access and develop new markets.

Forestry has long been a cornerstone of British Columbia's economy and can remain a pillar of Canada's low-carbon future, but only if we create the conditions for success. This is about more than economics. It's about sustaining rural communities, supporting indigenous partnerships and ensuring Canada remains competitive in global markets. If we fail to act, we risk losing not only jobs but the expertise and infrastructure that underpins sustainable resource development.

Thank you for your time.

[The Chair, Liberal, Terry Duguid]

Thank you, Mayor Dahl. That was right on the money.

Mr. Tochor is starting our first round of questions.

[Corey Tochor, Conservative, Saskatoon—University, SK]

Thank you, Chair.

I'm going to cede my time to MP Aaron Gunn.

[The Chair, Liberal, Terry Duguid]

Mr. Gunn, welcome to the committee.

[Aaron Gunn, Conservative, North Island—Powell River, BC]

Thank you for having me, Mr. Chair.

Thank you, Mayor Dahl, for making the journey out from our shared home of Campbell River.

You talked a lot in your comments about the importance of forestry to the economy of Campbell River, the north island and, indeed, the entire province. As mayor of Campbell River, have you noticed the real-world effects of the industry's downturn and challenges on families, businesses and individuals in Campbell River?

[Kermit Dahl]

Yes, for sure. I've lived in Campbell River for 40 years. My kids have been born and raised in Campbell River, all of their friends have been, and we see a lot of that younger generation, who have less seniority, being laid off or suffering with the curtailments that are happening. Yes, we see it every day.

I just finished a year-end financial and saw for the second time in 15 years a decline in our annual sales. Seventy per cent of what we do is resource-related, and our sales in the previous year were down by just over 20%.

[Aaron Gunn, Conservative, North Island—Powell River, BC]

You're obviously a small business owner in town. When people think of forestry, they think about the big mills. They think about the loggers out in the bush.

Can you talk about all the other businesses and people who make their livings indirectly from the forest industry in a community like Campbell River?

[Kermit Dahl]

In Campbell River, every business there is supported by logging. All of my trucks say, “my family is fed by the forest industry”. The forest industry is what supports our entire community. Whether you're selling clothing or operating a restaurant, every single thing is dependent on the logging community having continuous work so people can afford to go out and spend money, whether they're buying cars, houses, clothes or pizza at Boston Pizza. Every business is dependent on that happening.

[Aaron Gunn, Conservative, North Island—Powell River, BC]

How has the uncertainty created over fibre access—basically the predictable and sustainable ability to go out and cut down trees to feed the mills—contributed, in your view, to the downturn of the industry and the struggles that the industry currently faces?

[Kermit Dahl]

We were one of the first areas, or we were the first area, to lose our sawmills. Whether Gold River or Campbell River, it was that area. When we can't supply wood now, it affects the more central to southern part of the island. Our wood is what feeds their mills, so when we don't have access to fibre, those mills and their employees go down for unpredicted and unknown lengths of time. It puts out a lot of workers who are in a completely different area. They don't even know there's going to be a shortage of wood, because they're not seeing the lack of logging trucks moving up and down the highway, until one day they just get told that they're going to shut the mill down for the next eight weeks—or six months or whatever—to build up inventories.

[Aaron Gunn, Conservative, North Island—Powell River, BC]

You recently said in public comments that the coastal forest industry was maybe just one mill closure away from total collapse. Can you expand on that and the interconnectedness of the entire industry?

[Kermit Dahl]

When you lose a sawmill...the sawmill feeds the pulp mill. We're already bringing in 40% of the chips from the U.S. to feed pulp mills so they can continue to run. In Campbell River, I don't know, 17 years ago, our sawmill went down, and within about 18 months our pulp mill was gone. They need to have the stable feed of hog fuel and wood chips product, sawdust, to be able to afford to produce pulp and paper. If we lose another mill or two, it's going to be no time before we can't afford to continue to run. The margins are too tight in pulp and paper.

[Aaron Gunn, Conservative, North Island—Powell River, BC]

You spoke about how we were basically undercutting the total allowable cut, both on the coast and across the entire province. As you know, on Vancouver Island, we have a lot of very active environmental groups that are always proclaiming that forest companies are about to cut down the last true ancient forest or mystical forest. They're always changing their terminology.

What's your view? Are we running out of trees to cut down on Vancouver Island and across British Columbia, or do you think we have a very responsible and sustainable industry that could be maintained for generations to come?

[Kermit Dahl]

We do for sure. We haven't been achieving 50% of our allowable cut provincially.

Putting that aside, we have 11 million hectares of old-growth timber standing. That's equivalent to about two times the size of Nova Scotia. That's not just the protected. That's 11 million cubic hectares of standing timber that's in areas that have never even been seen by humans.

[Aaron Gunn, Conservative, North Island—Powell River, BC]

What message would you say to some of these environmental groups that probably have never been to the north Island or Campbell River and spend their time in downtown Victoria or downtown Vancouver?

[Kermit Dahl]

They should come to Campbell River, for sure.