Natural Resources Committee on Nov. 22nd, 2017

[Bob Matters]

The claim by the industry on the west coast is that this particular fibre is expensive to access. The only way they can access other fibres, such as cedar, is to harvest a profile, which is absolutely a must for our industry to be sustainable. In harvesting a profile, they get other wood that they don't want to manufacture.

Government policy must be reintroduced. Previously, there was a policy in British Columbia on what you had to do with your licences. That changed in 2000 and beyond.

[Ted Falk, Conservative, Provencher, MB]

You are suggesting that if the policy changes, where we would have to do further processing or value-added here, we could benefit from policies like that.

[Bob Matters]

The primary industry could certainly profit greatly and that would provide fibre for all these other wonderful products that are being talked about and under development, absolutely.

[Ted Falk, Conservative, Provencher, MB]

I would certainly think that we have the capability here in Canada to do that value added and that secondary processing, even on the dimensional side, which is sometimes considered primary processing, but I really think it's part of secondary processing as well. Somehow I think between industry and labour, they should figure out how we can be competitive in that Asian market and do that processing here and keep the value here in Canada. Sell them a finished good just like they do to us.

[Bob Matters]

It's critical to keep in mind that we ship as much lumber to China, so if we can do it and be cost competitive, then certainly we can do it with more logs than we're already doing it.

[Ted Falk, Conservative, Provencher, MB]

Sure. Good. Thank you very much for your testimony.

Mr. Moore, I'd like to ask you a few questions. Based on your biography, I'd really like to get some advice on ATVing and snowmobiling, but we're talking about forestry, so we'll talk about that.

You harvest urban forests, urban trees. You do tree removal. What kinds of species are you looking for? Is it anything and everything?

[Shawn Moore]

We take anything and everything. When you build everything from a pen blank all the way up to cabins and housing, you can use everything. We do take more of the structural spruce and pine. We don't have any fir around where we are. Typically that goes into our timber framing, beams, and glulam-type stuff. The hardwoods go into most of our furniture and decorative stuff, and vary quite.... There's quite a high market, if you've ever ventured into a Windsor Plywood lately and checked out the board footage price of live-edge lumber. It is quite an attractive market and very easy to make money there.

[Ted Falk, Conservative, Provencher, MB]

You talked about wood turning. What is that?

[Shawn Moore]

It's lathe work. Because of what I do, a woodworking guild found me right away in my very first few years. We host different types of meetings at our facility because they have access to local woods. They were always buying these awesome imported woods, and as people learned and had their projects fail, they realized that when you import some of the woods from different countries and different growing conditions, they fail way faster. We have really competitive, if not the most beautiful, wood products right in our own backyards. People don't know that. They think to get a beautiful hand-turned bowl or piece of furniture that it must come from somewhere else. If I said local box elder or Manitoba maple, it would be exotic Manitoba maple from Canada if it were in China or somewhere else. It's only exotic if you're not standing in the country that it comes from.

[Ted Falk, Conservative, Provencher, MB]

You're making me feel bad. I just cut down one of my maples and I cut it into board lengths for a fireplace. I probably could have added more value than I did.

[Voices]

Oh, oh!

[Ted Falk, Conservative, Provencher, MB]

You've also talked about replanting the forests that you harvest. I think our commercial forestry industry replants three to one. This is the number we've heard here at committee before. What is your ratio like?

[Shawn Moore]

We're such a small company we don't really have a ratio. Say, we took 10 trees to build a little project or 100 trees to build a cabin or something like that. We like to recognize our plantings as that. When we plant, we're typically planting with our smaller spade, a 36-inch root ball, so that's about a three and a half inch to four-inch trunk, which would be about a 12-foot tree. Then with our big 68-inch tree spade, we're planting in the neighbourhood of 20 to 25 feet tall, with a seven-inch trunk on that. We're putting back in the ground already ready-to-go, carbon-reducing trees, a larger size.

[Ted Falk, Conservative, Provencher, MB]

Good.

I think I'm just about out of time, but I do want to thank you for the really good work you've done and for being a good steward of our resources.

[The Chair, Liberal, James Maloney]

You are out of time, actually. Thanks.

Mr. Cannings.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Thank you both for being here. It's been very interesting.

I'm going to start with Mr. Matters.

I want to pick up again on the raw log exports, because it is an issue that I hear a lot about from British Columbia, especially Vancouver Island. The trouble, I think for us, is that this is primarily a provincial issue in most of Canada anyway, but I've also heard that there are federal angles to it, especially when the logs are taken off private lands. I wonder if you could expand on that and maybe give us a little more detail on why that.... I know that in British Columbia it used to be that forest companies that harvested the trees had to process them locally, and that went by the wayside, but that was a provincial decision. There are mills on Vancouver Island that want fibre but can't get it because the logs are going off.

I'm wondering if you could comment on what you think the federal government could do to alleviate this situation somewhat. What kinds of actions could we be taking?

[Bob Matters]

You're absolutely right, with respect to the exports. Most of the exports from the west coast are coming from private lands. Ironically, a lot of those private lands were initially held by public companies that had manufacturing facilities. They got access to those private lands way back when, most of it for railway. In terms of other private lands, there were always volumes that were attached to existing sawmills.

The provincial government of the day, after 2000, changed the requirements for tenure and allowed companies to change their tenure, sell their tenure, and even stratify their tenure, without having any public review processes.

I don't want to be trashing any particular company. The model was.... MacMillan Bloedel, as everybody knows, was a world leader in forest products. They had mills everywhere on Vancouver Island. They had some problems and they sold to Weyerhaeuser. When they sold to Weyerhaeuser, MacMillan Bloedel had their private lands and their public lands all feeding—this is what's critical—their own mills. Weyerhaeuser then spun off. With the government changing its regulations, they spun off their public lands and their private lands. The government regulations then allowed them to do, frankly, whatever they wanted with their private land volumes. With those private land volumes, the company started closing mills.

Now we have a third or a quarter of the mills we used to have. Pretty much the same volume is being harvested by the same players, if you go back and follow their heredity, but instead, they're harvesting it and exporting, because they closed their sawmills.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Perhaps I'll switch to softwood lumber and move away from that, as well.

I want to pick up on something that Mr. Bagnell said about the steelworkers in Washington, in the United States and Canada. I just have to say that when I went to Washington to talk to congressmen and senators about softwood lumber, it was the steelworkers who helped me make those political connections down there and who guided me through the maze of offices on Capitol Hill. They were very helpful, and I appreciate that.

One of the things about softwood lumber is that we can export some of these secondary products that we're talking about without being hit with the tariffs. I'm thinking of the engineered wood that other people have mentioned. You mentioned Structurlam. I assume it is at Chantiers Chibougamau—

[Bob Matters]

Yes.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

—that is also steel.

I'm wondering what you thought of the prospect of federal government procurement policies that might incentivize or de-risk the expansion of that industry. It seems to be a very good way to move forward and not only export our lumber but also add value to it before we export it, whether it's to the United States or China.

[Bob Matters]

Those procurement policies that favour wood construction and innovative...whether it's mass timber or whatever, are critical for two reasons. One that's obvious is that it creates jobs in Canada. One that's less obvious I learned about when I was over last week. We were trying to get the Chinese to do certain things with our wood products, to build in a certain way that our building codes didn't actually allow in Canada. If we think these products are viable, and they are, it certainly makes sense that Canada would showcase those through their policies to show the rest of the world that, yes, they do work and it's a sound product. That way, we get a big lift also.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

I'll move to Mr. Moore.

I want to thank you for your presentation, as well. Like Mr. Falk, I have an acre of land with trees that my father planted about 40 years ago, and I do a fair bit of logging off that. It's amazing how much wood you can get off a small lot like that.

What I find in my riding is that a lot of the forestry industry people talk about getting the best log to the best purpose. We lose that, I think, when we have the big companies that are set on just making two-by-fours or making paper. They're often using the wrong log for their purpose.

I'm wondering if you could comment on your model, on how that works, and perhaps on how you could expand that kind of model across the country.

[Shawn Moore]

When you want to go for a good cup of coffee, quick, cheap, and still have a great cup of coffee, Tim Hortons has that solution. If you pictured the Tim Hortons of the forestry industry, with a shop that you could step into to pick the right log for the right purpose and get a wonderful product out of it, that's what I envision. There's forest all across Canada, and we need these micro, very well-done franchises that we can figure out how the flow....

We've obviously had our challenges with our kiln and getting it up and running well. However, when you figure it out, if I can, as a tiny little company, cut a two-by-four on a small scale almost cost-effective to what I can buy it in the store, we could stop all these logs from going anywhere, and pick and choose where we send what value of each step of the process. That's what I envision with our little model.

Once we get it up and running effectively, it can be done over and over again within a couple of hundred miles. We can have lots of businesses. When you have a mass company, they only need a couple of clients to move large volumes. If you have a small business, it's attached to lots of other businesses and whatnot. Those logs and that product can easily be used up within a community. If you ask the city of Red Deer whether they could take six million board feet that a monstrous factory...it wouldn't even be in consideration.

It's the many different Subways or Tim Hortons of forest products all across Canada that I think would be a success.

[The Chair, Liberal, James Maloney]

Thank you.

Mr. Hébert.

[Richard Hébert, Liberal, Lac-Saint-Jean, QC]

Thank you, Mr. Chair.

I have a series of questions, and the first is for Mr. Matters.

I come from a big forestry region, Lac-Saint-Jean, which has the largest forested area in Quebec.

We know that secondary and tertiary processing are a possibility, but my question is about wood chips. Given the drop in demand for newsprint, companies have major surpluses of wood chips.

Mr. Matters, what new uses might be considered?