Natural Resources Committee on Nov. 20th, 2025

[Rick Jeffery]

We get federal government support in a whole range of different ways, but you're right that Global Affairs doesn't want to engender the ability for the U.S. coalition to argue that there's a subsidy if government invests in the industry. The U.S. coalition and the Department of Commerce use witchcraft. They change their methodology. There is a sensitivity and a risk there, so I think we need to sit down with the industry and figure out ways they can get money to help with retooling in a way that limits that risk. It's a real risk, but at the end of the day, we need to make some reinvestments.

As you pointed out earlier, $11 billion is sitting on the sidelines. Knowing how we can get some of that money back to our guys would be useful, but we have to be cognizant of the risk.

[Mario Simard, Bloc, Jonquière, QC]

Thank you, Mr. Jeffery.

The Build Canada Homes agency comes up a lot, so I'm eager to see how it will be structured. I realize it's very important.

Whenever I go to Europe, I'm really struck by all the large-scale public infrastructure built out of wood, bridges, for instance. That is not necessarily the case here, even though we're supposed to be major wood producers, both in British Columbia and in Quebec. Are we lagging behind on that front?

[The Chair, Liberal, Terry Duguid]

Answer in 10 seconds, please.

[Rick Jeffery]

In Quebec and the Maritimes, there is much more of that kind of wood-bridge building and those kinds of things. It is an opportunity. It's regional in nature, and we are doing work on it.

[The Chair, Liberal, Terry Duguid]

Mr. Rowe, welcome back. You have five minutes.

Then you're on deck, Mr. Danko.

[Jonathan Rowe, Conservative, Terra Nova—The Peninsulas, NL]

Thank you.

My first question is for Mr. Jeffery.

In Newfoundland and Labrador, we've had two paper mills close in a little over a decade. Our current pulp and paper mill is on its last legs, yet our forest has very small trees that are ideal for pulp.

What are some ways that Newfoundland and Labrador can pivot our forestry industry away from paper and into other manufacturing industries, because the demand for paper is going down?

[Rick Jeffery]

That's a great question. On our side of the business, we're focused on construction using solid wood and those kinds of things.

They vertically integrated in Europe to focus supply away from the pulp mills. What do they do? They do bioenergy. They create pellets that go into the U.K. tariff system for energy. They use them for heat and power in their own facilities, and they also make wood fibre insulation out of it.

Wood fibre insulation is an opportunity that's in front of us right here in Canada. We're working to make sure the CSA standards and those things are available for folks. Now we have to attract people to say, “Hey, that's a good investment” so that we can take that chip supply and use it for that kind of thing.

You can also start to think about some of those other engineered wood products. You can flake the stuff and chip it to make LVL or oriented strand board and those kinds of things, and there are other streams where you can send residuals.

[Jonathan Rowe, Conservative, Terra Nova—The Peninsulas, NL]

Yes, bioenergy is something that is becoming big in Newfoundland. Some buildings are actually transitioning away from home heating fuel to bioenergy, furnaces that use chips. It's a good industry.

Speaking of chips, Mayor Dahl, you mentioned that there's actually a shortage of chips to your pulp and paper mills, and they come from the States. Why is there a shortage of chips? Is it because of the actual cost of foresting? The price of fuel has gone up. There are permitting restrictions. Why is there a shortage of chips in Canada? You mentioned large, old forests. I'm just curious if there are more reasons there.

[Kermit Dahl]

The main reason we have a shortage on the coast is that we've lost, I think, 44 sawmills in the last fifteenish years. Those sawmills produced the chips that the pulp mills used to produce energy and pulp and paper.

[Jonathan Rowe, Conservative, Terra Nova—The Peninsulas, NL]

There's a synergy there between the two industries, and one without the other is lacking. What we're seeing in Newfoundland is kind of the opposite. Our pulp and paper mills are closing because of the lack of paper, and our sawmills are having difficulties finding something to do with the chips. We've actually had fires in my region because of sawdust piles collecting and actually combusting.

Speaking of fires, you talked about how B.C. has some old forests, and what we're seeing now in Newfoundland is that our forests are getting very old. The forestry industry is saying that they go in to try to get logs or lumber for logs, and the wood is almost too old for that. Do you think that increases the risk of fires in B.C. and Newfoundland?

Can you explain the importance of the forestry industry in preventing fires?

[Kermit Dahl]

It certainly increases the risk if you're not taking the fuel out. It's a continuous change—taking the timber out, sending it to the mills, replanting and starting the cycle over again. That reduces the risk, and you can build fire breaks by engineered plans for how you're logging the cut blocks. On the east coast we do primarily, and almost exclusively, clear-cut logging. We take everything out, and then clean it up and replant. It makes a fire break from one area to the next.

[Jonathan Rowe, Conservative, Terra Nova—The Peninsulas, NL]

Do you think that having 30 by 30, where we're protecting 30% of the forest by 2030 and 50% of the land and forest by 2050, will significantly increase the risk of fire in B.C. and Newfoundland, and across the country?

[Kermit Dahl]

Without a doubt.

[Jonathan Rowe, Conservative, Terra Nova—The Peninsulas, NL]

I'm just shifting again. I have another few seconds.

Mr. Jeffery, you're talking about building with wood. I'm from Newfoundland and Labrador, and most of our buildings are built with wood. I come here to Ottawa and other cities, and it's mostly steel and concrete, because of high-rises.

Do you think that the federal government should be trying to create policies so that people are encouraged to live in rural areas so that, then, wood construction is more sustainable, more practical, in those areas?

[The Chair, Liberal, Terry Duguid]

Give a quick answer, please.

[Rick Jeffery]

I think we can build wood structures in urban and rural environments. As I said, the most affordable housing unit we can build is a six-floor building that could be built in small cities, big cities, towns, villages, that kind of thing.

[The Chair, Liberal, Terry Duguid]

Thank you.

Mr. Danko, you're the final MP on this panel.

[John-Paul Danko, Liberal, Hamilton West—Ancaster—Dundas, ON]

Thank you, Chair.

I'm really enjoying this conversation. As a structural engineer, I love building with wood. It's one of my favourite materials. It's so nice to design, and it's beautiful once built.

I wanted to give you the opportunity, Mr. Jeffrey, to speak about some of the general benefits of wood construction. You spoke about the cost benefits for that six-storey building, but beyond that, what are the benefits of working and building with wood?

[Rick Jeffery]

First and foremost, it is economical up to that sixth floor, and as I said, as we're learning and building out and getting experienced in the construction sector, those seven- to 12-storey structures are now becoming cost-competitive. These types of buildings are also very good in terms of speed of construction. There's a cost benefit there, but there's also a benefit to the communities, because they tend to be built in places where people are living. If you can build them faster, the disruption to those communities is lessened.

As I said, wood buildings support the sustainable forest industry and the jobs, those kinds of things. It's low carbon, so the carbon benefit is very good, and it has biophilic options. Studies are now showing that wood buildings are better for people's health—for calmness, for their mental health, for their healing properties. As we were saying earlier, it's like forest bathing inside the building. There's this biophilic opportunity, and the wood buildings are beautiful. We're a forested nation. We should be celebrating a culture of building with wood, because that's who we are and that's where we come from.

[John-Paul Danko, Liberal, Hamilton West—Ancaster—Dundas, ON]

Absolutely. I agree with that 100%.

Thinking about where Canada is, having such a vast forestry sector, what are some of the global leaders in wood construction? Where should we be looking? What lessons can we learn from around the world on what we need to do here?

[Rick Jeffery]

We've been taking delegations for probably the last decade to central Europe. They're the leaders in mass timber manufacturing. We're learning from them. Just recently, Hasslacher made a big investment in Element5 in St. Thomas, Ontario. That was as a result, I think, of our forging ties with them. Just last month we took a delegation to Sweden. Sweden builds 80% of their housing in factories. They're world leaders in that. We took a bunch of industrialized construction folks there to look at that. They're world leaders in it.

I'm going to tell you: I'm a forester by training. I ran Coast Forest Products Association on the coast of B.C. for 15 years. I am intimately familiar with the challenges faced by places like Campbell River. We are a world leader. We should be celebrating that. We should be building on that. We have world-class forestry. We have world-class forest products. We have a construction industry that's now starting to adopt forestry. We should be building on that to meet these challenges. We should celebrate it. Too often in this country we're not celebrating it. We should be celebrating it.

[John-Paul Danko, Liberal, Hamilton West—Ancaster—Dundas, ON]

Absolutely. I'd love to leave it at that, but how much more time do I have, Chair?

[The Chair, Liberal, Terry Duguid]

You have a little over a minute.

[John-Paul Danko, Liberal, Hamilton West—Ancaster—Dundas, ON]

Okay.

Is there anything else you want to add, Mr. Jeffery, on specific government policies or what's in the budget for housing construction and infrastructure that we can work towards to make sure we're....

[Rick Jeffery]

Yes. There are three programs in NRCan that I'd like to give a shout-out to as part of that softwood lumber sector support package.

One is the forest innovation program that funds research—research into forestry, research into forest products and research into bioenergy and pulp products. It's a very important program.

There's also the investments in forest industry transformation program. MP Simard asked earlier about places where funding is available for sawmills. That IFIT program is a place where that money can be used to fuel innovation as well as help us with the housing crisis.

Finally, there is the green construction through wood program. We partner with NRCan to help us help the architects, engineers, construction, development, municipalities and universities build with wood and do the technical support and tech transfer. That helps them start to be able to be more comfortable and build more of these wood buildings.

Those are three programs that I want to shout out, but we also do a lot of work with the National Research Council. They do a lot of research. We need to do that research in order to be able to go into the codes world and make sure we can advance codes for wood buildings that are safe, affordable and resilient and that meet the needs of Canadians.