Thank you, Mr. Chair, honourable members and colleagues from across the forestry value chain, for the opportunity to speak today.
My name is Scott Hughes, and I'm a second-generation owner of Hupaco Wood Products Limited.
Canada's forestry sector employs 600,000 direct and indirect jobs, and it is the economic backbone of nearly 300 communities, yet we are losing ground in global markets. If we want a strong, sustainable industry today and beyond, we must act decisively on six fronts.
The first is countervailing and anti-dumping duties. The United States has imposed duties averaging over 20% on Canadian software lumber for decades. With the latest round, I thought it was 35%, but I was corrected. It's now 57.6%. These duties have already cost our industry more than $7 billion since 2017 alone. Raised housing costs in the United States shrink our market share and force more containments and permanent closures from British Columbia to Atlantic Canada.
This is the longest-running trade dispute in North American history. Over 40 years and five failed trade wars, Canada has won the legal argument at least 15 times at NAFTA, CUSMA and World Trade Organization panels, yet every time we win, the U.S. lobby restarts the clock. We must keep fighting legally, but we must also negotiate a long-term managed trade agreement that finally ends this cycle. Anything less is surrender.
The second is the federal government's role in market diversification and value-added production. Yes, we must diversify to Europe, Japan, South Korea, India and the Middle East, but let's be crystal clear: We cannot simply switch markets and walk away from the United States. The United States takes 77.5% of everything we cut. No other market or combination of markets can absorb that volume in the next five, 10 or even 15 years. Mills will close, towns will hollow out and thousands of families will lose their livelihoods long before new export corridors materialize.
Retooling a single mid-size sawmill to produce European spec lumber and pallets costs $50 million to $100 million and takes 18 to 24 months. That is money and time that many producers do not have when duties are eating at their cash flow. Meanwhile, Brazil is already shipping European pine and pallets into the European Union at a cost 20% to 30% lower than ours.
Diversification is not life support; it's a long-term growth strategy. In the short and medium term, our survival still depends on regaining full, duty-free access to the American market. This is why aggressive negotiations with Washington must remain job one. Everything else—value-added funds, trade missions and retooling grants—is vital, but it buys us time; it does not buy us survival.
The third is the unique importance of wooden houses and carbon neutrality. For over 20 years, I have worked hand in hand with architects and engineers across Ontario, designing roof trusses and floor systems for single-family homes, townhouses and low-rise buildings. My job is to squeeze every last square foot out of a load of lumber so that families can afford a safe, high-quality home.
I know first-hand that wood is the most versatile, cost-effective and climate-friendly building material we have. A typical 2,000-square-foot family home built with Canadian lumber stores about 30 tonnes of carbon dioxide. A 20-storey mass timber tower sequesters about 3,500 tonnes, which is the same as taking 900 cars off the road for a year. If we simply raise the share of wood-framed, single-family homes, mid-rise and tall wood buildings from roughly 12% today to 30% by 2035, we will cut millions of tonnes of emissions, while creating tens of thousands of rural jobs.
Right now, our home builders are the single largest consumer of Canadian dimension lumber, after pallets and crates, and they are being strangled by red tape. We cannot hit our housing targets or climate targets unless we fast-track builders who choose wood. Give them presumptive approval for proven systems and stop treating renewable Canadian lumber as if it was a problem, instead of a solution.
The fourth is a national public procurement policy that favours wood. A simple “wood first” policy for federally funded buildings will create stable domestic demand and show real leadership on climate and jobs.
The fifth is sustainable forest management practices. Canadian forests are among the best managed on earth. Over 90% of harvested areas are promptly regenerated, and over 160 million hectares are third party certified. Good management keeps the forests healthy in a changing climate. We need to tell that story loudly and proudly.
The sixth, finally, is to respect provincial and territorial jurisdictions. Forests are constitutionally provincial. Ottawa sets national goals and provides funding and coordination, never micromanagement. Real progress only happens when we work with true partners.
In closing, we stand at a crossroads. We can keep bleeding jobs while we wait for new markets that will take a generation to build, or we can fight like hell to keep the U.S. market open, while we diversify, innovate and build more Canadian homes, pallets, wood packaging and other wood products with Canadian wood. The choice is ours and the time is now.
Thank you.
