Natural Resources Committee on Oct. 30th, 2025

[The Chair, Liberal, Terry Duguid]

I call this meeting to order. Good morning, colleagues.

Let me start by acknowledging, as we always do, that we are meeting on the unceded territory of the Algonquin Anishinabe nation.

Welcome to meeting number 10 of the Standing Committee on Natural Resources. Today's meeting is taking place in a hybrid format, pursuant to the Standing Orders, but I do not believe we have anyone on Zoom at the moment.

Let me remind members and witnesses in the room that you can use the earpiece on the table in front of you and select the desired channel for interpretation.

Please remember our amazing interpreters, who just waved. Consider their ears, please, and put the earpiece on the decal in front of you when you're not using it.

To our witnesses, if you would, please speak at a measured pace so that interpretation can translate faithfully what you say.

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

I would like to welcome our witnesses on the panel.

We have, from the Department of Natural Resources, Glenn Hargrove, assistant deputy minister, and Greg Smith, director, Canadian Forest Service.

Welcome, and thank you for joining us. You will have five minutes or less for your opening remarks.

Mr. Hargrove, you have the floor.

[Glenn Hargrove, Assistant Deputy Minister, Department of Natural Resources]

Thank you, Mr. Chair.

Good morning, Mr. Chair and committee members.

My name is Glenn Hargrove, and I am assistant deputy minister of the Canadian Forest Service at Natural Resources Canada, NRCan. Thank you for inviting me here this morning.

I would like to begin by recognizing that we are gathered today on the traditional unceded territory of the Algonquin Anishinabe people.

Canada is a steward of a vast forest resource containing 9% of the world's forests.

Activities from logging to the manufacture of wood products and pulp and paper contribute about $30 billion to nominal GDP. The sector is the primary source of jobs and income for some 300 communities, including many rural, remote and indigenous communities across the country. The sector directly employs nearly 200,000 people, including 11,000 indigenous people.

With strong laws and regulations in place that ensure forests in Canada are harvested sustainably, the sector is well positioned to—

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

I have a point of order. I'm not getting translation.

[The Chair, Liberal, Terry Duguid]

Thank you, Mr. Tochor. We're testing.

Good morning, everyone. My name is Terry.

[Mario Simard, Bloc, Jonquière, QC]

All anglophones know this in French.

[The Chair, Liberal, Terry Duguid]

I love this committee.

I'm going to suspend for a few moments while we work this out.

[The Chair, Liberal, Terry Duguid]

Colleagues, we're back in session. We stopped your time, gentlemen, so please continue where you left off.

[Glenn Hargrove]

Thank you, Mr. Chair.

With strong laws and regulations—

[The Chair, Liberal, Terry Duguid]

We're suspended again.

[The Chair, Liberal, Terry Duguid]

We're back in session. Please proceed.

[Glenn Hargrove]

With strong laws and regulations in place that ensure forests in Canada are harvested sustainably, the sector is well positioned to supply renewable materials with a low carbon footprint to help meet Canada’s housing needs, to fuel lower-emission steel and cement production, and to offer alternatives to fossil products such as chemicals and plastics.

The Canadian forest sector is closely tied to the U.S. economy. In 2024, 76% of Canada's $37 billion in forest product exports went to the U.S., and 89% of Canada's total softwood lumber exports went to the U.S. That relationship is why the imposition of duties on Canadian softwood lumber products since 2017 has been so consequential. More than $10 billion in capital from Canadian softwood lumber exporters has been paid to the U.S. over the eight years. This has affected liquidity and credit availability to sawmills.

This summer, duties reached over 35% for most exporters. Following that, this fall the U.S. announced an additional 10% tariff on imported wood products as a result of a section 232 investigation.

Since the forest sector is highly integrated, disruptions to lumber exports and demand have ripple effects, and supply to wood product facilities is affected when lumber demand declines. Chips and sawdust, which are byproducts of lumber production, become less available, affecting inputs into the manufacturing of goods such as panels for housing construction, packaging, solid biofuels and other bioproducts.

This means that when a sawmill closes or curtails operations, impacts are felt not only by the mill community and among its employees but also well beyond. Since 2022, a total of 21 sawmills have closed, and an additional 55 have curtailed operations for economic reasons. In the pulp and paper industry, nine pulp and paper mills have closed, and an additional 12 mills have curtailed operations or have temporarily closed.

The role of Natural Resources Canada centres on working with provinces and territories and industry to diversify, support and transform the sector to address these challenges.

Specifically, NRCan supports research, for example for codes and standards development. NRCan provides funding to help de-risk investment and the deployment of novel technologies to help get industry to a place where, increasingly, it makes economic sense to produce more lumber in Canada. The department also undertakes international engagement and provides global leadership. For example, our wildfire activities build relationships with reliable partners to respond when disaster strikes, and our outreach and engagement activities with companies help open new markets for Canadian wood products.

This summer the government announced $1.25 billion in support of the forest sector, including $700 million delivered by the Business Development Bank of Canada for a new loan guarantee program to help softwood lumber companies confront immediate tariff and duty pressure.

Another $50 million was delivered by Employment and Social Development Canada to support workers, and $500 million went to renew NRCan's forest sector transformation programs, with an increased focus on programming that helps accelerate housing supply and market diversification.

The announced buy Canadian policy will also help to support the forest sector by encouraging the use of wood, and Canada already produces much of the wood we need.

Wood is used to frame 95% of single family homes in Canada, 87% of multi-unit residential buildings of four storeys or less and over half of five- and six-storey buildings.

Codes that allow 12- to 18-storey mass timber construction, along with the focus on off-site construction, point to the potential for the housing agenda to drive transformation in wood manufacturing.

NRCan will be working with Housing, Infrastructure and Communities Canada, Public Services and Procurement Canada and the Treasury Board Secretariat to ensure that these initiatives provide effective support for the forest sector in Canada. At the same time, NRCan will continue to deliver programs to support needed innovation in the sector, boosting productivity and increasing value-added production, to aid in the transformation of Canada's forest sector for the long term.

Thank you very much for inviting us to be here today. We would be happy to answer your questions.

Thank you, Mr. Chair.

[The Chair, Liberal, Terry Duguid]

Thank you, Mr. Hargrove. I gave you a little extra time. Thanks so much, and thanks for your patience in getting the translation working.

Colleagues, we'll start our first round of questions and comments. We're going to start with Mr. Tochor.

Mr. Tochor, you have six minutes.

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

Thank you, Chair, and thank you to our witnesses.

I have a question about the Liberals' commitment to plant over two billion trees in the next 10 years. It was made in 2019, and I'm not sure which of our witnesses may have been briefed on this promise.

Glenn, you're indicating that you have been briefed. That's great.

In August of this year, a news report came out that referenced a report that—tell me if this is correct—11.4% of the pledge has been committed to in six years. Is that accurate?

[Glenn Hargrove]

No. To date, there are commitments to plant nearly a billion trees—

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

No, not commitments: There has been only 11.4% of that commitment—the two billion trees—planted and actually in the ground.

[Glenn Hargrove]

That's probably close. Yes, it's less than 300 million planted to date.

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

Okay. It's 228 million. That's the word from the government.

One of your jobs is to brief government administrators on how things are going in government. Is that accurate?

[Glenn Hargrove]

Yes.

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

Have you heard the phrase past performance is the best indicator of future performance?

[Glenn Hargrove]

Yes.

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

If you get your calculator out and help us, both the committee and the viewers online, and if it's 228 million trees and you divide that by six years, what does that get you? You can use a calculator.

[Greg Smith, Director, Canadian Forest Service, Department of Natural Resources]

[Inaudible—Editor]

[Glenn Hargrove]

It's 38.

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

You're right.

Thirty-eight million trees per year is what the Liberals have been able to plant. Two billion is the promise the Liberals made. Divide that by the 38 million trees they've planted per year so far. How many years does that come up with?

[Glenn Hargrove]

It's a little over 50.