Evidence of meeting #17 for Natural Resources in the 39th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was mills.
A recording is available from Parliament.
12:05 p.m.
Bloc
12:05 p.m.
Director General, Fédération des producteurs de bois du Québec
It would have been the case if, for example, in the area of taxation, it had already been suggested to the provincial governments that they support programs for private woodlot operators, programs based on silviculture that help to improve the forest without necessarily producing wood to harvest in the short term.
12:05 p.m.
Bloc
Christian Ouellet Bloc Brome—Missisquoi, QC
Thank you. That would have been important.
Mr. de la Roche, I know that FPInnovations is involved with composite materials, which is something that I find quite impressive since the future in this field is quite promising.
Do you think that the $10 million allocated for research and development in this year's budget will really help to ensure that these materials are developed through pilot projects and eventually brought to market?
12:05 p.m.
President and CEO, FPInnovations
It is true that $10 million is not enough, but we must not forget that last year, the federal government invested $50 million in FPInnovations for its work on processing technologies. Moreover, we had an opportunity to increase that amount by another $10 million per year through the provincial contribution. So, if we add another $10 million to the $20 million over three years, that represents $30 million. Moreover, the members of FPInnovations also provide their own contribution. These amounts are becoming quite significant.
12:10 p.m.
Bloc
Christian Ouellet Bloc Brome—Missisquoi, QC
Do you think that the $10 million will be handed over exclusively to FPInnovations?
12:10 p.m.
President and CEO, FPInnovations
I was not referring to the $10 million, but to other funding. That said, we must not forget that the federal government provided us with funding to set up FPInnovations. We are working towards ensuring that universities will take an interest in biocomposites and nanotechnology. Things are starting to happen. NanoQuebec was provided with a large amount of funding. The Quebec department responsible for economic development, innovation and exports is a provincial ministry. I can tell you, Mr. Ouellet, that more is always better, but that does not mean only $10 million.
12:10 p.m.
Bloc
Christian Ouellet Bloc Brome—Missisquoi, QC
Okay.
Mr. Chevrette, the President-CEO of the Quebec Forest Industry Council said that the forest products industry had a great deal of future growth potential. World markets are growing, and there is increased competition for the land on which these resources are located. It is a matter of deciding how to position the Canadian industry for the future.
Do you have any ideas in this regard, Mr. Newman?
12:10 p.m.
Director, Research, Communications, Energy and Paperworkers Union of Canada
Yes. I believe Mr. Rigoto talked about restructuring the entire industry, and that is why the amounts are laughable. Our industry was outdated, and now it is beginning to be more forward-looking. We need a considerable amount of money in order to rethink the entire industry, to make up for the time that we have lost over the past 20 to 30 years, and to face the challenges represented by international markets and new products. Construction will continue, and paper products will be used. They must be made in Canada. That is what we want. That is why we have to completely rethink the industry.
12:10 p.m.
Bloc
Christian Ouellet Bloc Brome—Missisquoi, QC
If you were to calculate how much the federal government should contribute to cover those needs, how much would that represent?
12:10 p.m.
Director, Research, Communications, Energy and Paperworkers Union of Canada
We would need many billions of dollars for the forest industry alone. It would take $3, $4, or $5 billion to revamp the industry.
12:10 p.m.
Conservative
The Chair Conservative Leon Benoit
Merci, Monsieur Ouellet.
We will go now to the New Democrats and Ms. Bell for up to seven minutes.
February 28th, 2008 / 12:10 p.m.
NDP
Catherine Bell NDP Vancouver Island North, BC
Thank you, and thanks to all the witnesses today on very interesting presentations. I have heard a common thread about research and development. Money has been put in and that's great, but more money is needed. So I'd like to follow on that thread.
The $10 million announced in the budget the other day is basically for advertising and innovative products throughout the world. But what we're looking for here is money to help the industry become more innovative. From your perspective, how much more money is needed and what do you see from that money.
NRCan has said that almost 30,000 jobs have been lost in the industry. Mr. Coles, you said 20,000 of those were jobs directly from the CEP. So we've lost the bulk of the jobs in the industry, which is quite huge. Mills are closing across the country. I feel that in my communities. There is another mill closing as we speak.
I'm just wondering if you can tell us more about the impact on the communities of the closing of those mills and the loss of the skilled workforces in those communities. What does that mean for the future of the industry? I think the industry is not dead or dying, and it can become sustainable, and I'm hearing that from you as well. So I'd like to hear your points of view on all those questions.
12:10 p.m.
President, Communications, Energy and Paperworkers Union of Canada
To answer your last question first, the devastation in rural communities is almost indescribable. The last one that I personally experienced was in British Columbia. That was the closure of the AbitibiBowater newsprint mill and sawmills in Mackenzie, British Columbia.
What's so brutal about that story is that it wasn't one of the old mills. It was probably one of the most modern new mills in newsprint we had in Canada. For all kinds of reasons, AbitibiBowater pulled the plug on it. It could not make money. It was bleeding cash. From a community that had employment for about 4,000 workers in the forest industry, it's down to about 400 total. It has ruined the lives of many people.
The answer we get from some is, well, they can move to Alberta. My God, though, you have no idea what it does to a family to pick up your kids, move your grandparents, do all of those things when there's generation after generation just entwined in the forest community.
So it has had a huge impact. And it is a big resource; I agree with Mr. Rigato about these decimated communities.
On the issue of money, we have asked the Prime Minister to put $10 billion into research and development and advancing biotechnology. Why would we reach a number like $10 billion? Because people don't understand capital investment. To build a moderate-sized pulp mill in the world today, it costs $1.5 billion to $2 billion. And that's one mill, not multiple.
So as to the suggestion that $10 million is going to lead the light--come on, it can't work. We need real money, not subsidy, for research and development, and we wouldn't mind a bit of money to help communities transition through here.
12:15 p.m.
As an Individual
Catherine, I'd like to answer your question, and I would also like to comment a bit on Monsieur Ouellet's question on the $10 million.
We desperately need a policy that says we will convert the forest products industry to a biofibre industry in Canada and then put the right amount of funds in there to make that industry viable. It has to come the other way around or we will always have a debate on whether it's enough funds.
The devastation in the communities--I live in Thunder Bay, and we've lost 12 paper machines in three mills right around us--is incredible. There are no young people in the industry. The average age is 50 years old. There are no apprentices. No one has gone into the bush in the last 20 years. The truck drivers who are driving our transports out of the bush are all around 60-plus years of age. No one is going into the industry. We're not building any talent whatsoever.
To give you one example of where we clash, the provincial government is shutting down coal plants. British Columbia is exporting half a million tonnes of wood pellets to Germany to replace coal. Atikokan has a coal plant that's scheduled to be shut down. Atikokan has huge amounts of fibre, but we clash rather than mesh because the policies aren't there to push that.
12:15 p.m.
Conservative
12:15 p.m.
Pierre-Maurice Gagnon President, , Fédération des producteurs de bois du Québec
Ms. Bell, you asked for an example. We were referring to private owners. There are 450,000 in Canada and 130,000 in Quebec, 50 of whom are active owners. The forest provides their livelihood. I am an owner, I come from the Saguenay—Lac-Saint-Jean region, but I will give you the example of another region because I am the provincial president of the organization.
Not a single log was delivered to the plant this year by three sawmills in Abitibi-Témiscamingue. Nevertheless, these people are organized. They have woodlots, machines and deadlines to meet, but they were unable to sell any wood. Moreover, Quebec has a law respecting residuality. Nevertheless, the industry gets its supply from public forests, and the wood from private forests comes second. There is not even any political will.
I don't know what they do in other provinces, but these people are at the end of their rope, they are in despair. That is what is happening in Quebec, Ms. Bell, and I imagine that the same thing must be happening in other provinces. They take the wood from the public forests, and ignore the private owners.
12:15 p.m.
Conservative
The Chair Conservative Leon Benoit
Ms. Bell, your time is up.
We'll go now to the government side, to Mr. Harris for seven minutes.
12:20 p.m.
Conservative
Dick Harris Conservative Cariboo—Prince George, BC
Thank you, Mr. Chair, and thank you, gentlemen, for all of your presentations.
I want to perhaps start with Mr. Rigato. I think in your presentation, sir, you really accurately described the problem we've encountered with outdated technology in our pulp and paper industry as well as for a large part in our softwood and wood-producing industry.
There were times, and I know you gentlemen remember the heady days of the industry, when the mill owners didn't have to get out of bed in the morning and they made $50,000 that day. Those were good days, and we had lots of employment. But, and you said it yourself, we weren't updating the mills, and we got caught. So instead of blaming—it's easy to blame everything on the government, but you know what, in reality the industry has to take a lot of the responsibility for that as well.
I know you're quite right when you talked about some of the technology in our paper plants being from the 1950s and 1960s, whereas South America and Scandinavia have become up-to-date and are cutting our grass big time on the world markets.
I'm from central B.C., as you know. We have world-leading technology out there. We make wood cheaper than anyone else in the world, from a cost point of view.
The mills that have advanced their technology in the lumber side and the mills that have advanced on the pulp side, those are the ones that will, even though we're in a downturn, remain relatively strong and be in a really good position when the cycle starts to go again. As Mr. Lazar pointed out last week, the industry is going through a transformation, and that's a reality in every type of manufacturing sector. There are always periods of transformation when you have to reassemble your troops and then march down into a few more victories than what we've being experiencing.
I just wanted to make that comment. I think we realize there's a challenge. The government has a role to play, and so does industry. Mr. de la Roche talked about his organization, the technology and the research, and the path they're going down, and there's money from provincial and federal governments going toward technology.
Mr. Coles, I won't go into it, but I have to disagree with you. There's quite a record since 2006 of our government putting money specifically into the forest industry, research and development, and forest health. There was a time in British Columbia, for example, when the Canadian Forest Service used to do the pest control oversight. Back in the early 1990s, the province—I can't remember what government was in power—said it would take it over, just send the money. But in fact it never did start up again. I don't know if they're still getting the money. They shouldn't be, if they're not...but the government has changed now.
I can't disagree with the whole.... You guys have all presented a very accurate picture from your different points of view, and that's going to serve us well.
But before I run out of time, I have to ask you something, Mr. Rigato, because I want to take this back to British Columbia. You made a statement that technology is available to control the mountain pine beetle, but it has not been applied. I have to know what that technology is, sir.
12:20 p.m.
As an Individual
It's the application of pesticides that can control it, but it's environmentally unacceptable to do it. It's going to devastate the industry. It's moved across the Alberta border unstopped.
12:20 p.m.
Conservative
Dick Harris Conservative Cariboo—Prince George, BC
I know that. So you're saying that there is a pesticide spray available, but the environmental hazard of it precludes the use of it?
12:20 p.m.
Conservative
Dick Harris Conservative Cariboo—Prince George, BC
If there in fact is one, I suppose some would argue that's a good thing or a bad thing. Probably the reason we're not using it is that it is environmentally damaging. However, the mountain pine beetle devastation has served to spark a surge in technology to try to find further uses for pine-beetle-infested wood. I know that at the University of B.C., the University of Northern B.C., and at the University of Victoria there's technology--and I think at Simon Fraser, but I'm not sure--and there is research and development going on, and all of those programs are being provided funding by the provincial and federal governments. We would always argue it's not enough, but there's been some good research done. When I heard you say that, I thought, “Oh, this is good, we have to find out what it is”, but if it's something we can't use, then it really isn't important, I guess.
You're not suggesting that we use it, of course.
12:25 p.m.
As an Individual
No, I'm suggesting that we have to have a policy. Do we want to protect that industry? Three, five, seven years from now British Columbia will have 50% less wood to put out. Then what do we do with David's members?
12:25 p.m.
Conservative
Dick Harris Conservative Cariboo—Prince George, BC
I think the key to it is probably in research and development, in biofuels and bioenergy, and in different value-added wood products that can be developed from the pine-beetle-damaged trees, and that's what's going on right now. There's a lot of money going into research and development. I know that Mr. de la Roche talked about that and--