Natural Resources Committee on June 16th, 2026

[Frédéric Verreault]

It remains very significant. Every percentage point of the sales we have in the U.S. that we can switch to Canadian markets makes a difference. In a market that relies on the balance between the offer and demand of lumber across North America, which has been the case for decades now, every percentage point makes a difference.

If you look at the report, we have figure 3 on page 25 and the spread of the lumber consumption per category in North America. You can see that compared to 2021 and 2022, the step back of the market is only 3% to 4% now, compared to that shortage period. This means that every time we move a percentage point, it has a huge impact on market viability and the price of lumber. If we double, for instance, the mass timber construction, it has a material impact on the destination of lumber and the global viability of markets.

Yes, Canada, and even the Canadian government through public infrastructure, can have a material effect on market viability.

[The Chair, Liberal, Terry Duguid]

Thank you.

[Ken Kalesnikoff]

Chair, could I add something?

[The Chair, Liberal, Terry Duguid]

Please go ahead.

[Ken Kalesnikoff]

We have the Build Canada Homes policy now. They're talking about building thousands of homes. If we built the homes we need with the lumber we have, what Frédéric is talking about would have a huge impact on the reliance on the U.S. market, and we could change that. Never mind all of the buildings, whether they're mass timber or not, we could be building that are being built out of concrete currently. That's a huge piece that would help us.

[The Chair, Liberal, Terry Duguid]

Thank you for that addition.

Wrapping up this panel is Mr. Saini.

You have five minutes.

[Gurbux Saini, Liberal, Fleetwood—Port Kells, BC]

Thank you to the witnesses.

I also want to commend Minister Hodgson for allowing this process to take place at a very critical time.

Ken, I live in British Columbia. I come from Williams Lake, in the neighbourhood of 100 Mile House. At one time, those communities were 80% dependent on forestry. Now half of that business has gone.

The biggest problem was with the U.S. market. We think we have a problem right now, over the last two years, but the forest community has been fighting those problems for the last 30 years. We challenge them and we win in court, but a few years later, the U.S. goes back into it. What can we do?

I don't think we can really get away from U.S. markets 100%. The U.S. will continue to be a major part of our economy. Yes, we can build in Canada, but we don't have enough capacity to use the forests that we have in Canada.

I'd like to hear from Ken and the other gentleman their views on those issues.

[Ken Kalesnikoff]

I think the task force specifically did not want to spend a lot of time on the softwood lumber issue because.... You said 30 years. The very first time this thing raised its head was in the early or late 1800s. I have a document. It's ridiculous. We continue to make policy based on what the Americans want. We need to make policy based on what Canada needs.

I do not disagree that we should divest ourselves completely of the U.S. market. The U.S. market is a huge market. It's right here. We need to look at it. We are already, as companies, always looking at external markets. Expanding the export market is possible, but we're already doing that.

What we are not doing is focusing on Canada. There are so many things we could do in Canada. As much as you're saying we can't use it all—I do not disagree—we could use a significant amount more. We could do so much more by focusing the needs of the forest industry...what we need it to have to make it stronger in Canada.

Frédéric, I'll pass it to you.

[Frédéric Verreault]

To give you a clear example of this, if wood doesn't increase its market share of the different construction materials, but the targets that we have with BCH, Build Canada Homes, for instance, are achieved, this only fixes a quarter of our exports of lumber in the U.S., a quarter. That's highly important.

In addition to this, we exported about 12 billion board feet of lumber last year to the U.S. The U.S. has a deficit of lumber that is higher than our total exports. We often address the subject of the softwood lumber dispute as being based on our own emotions and our own impacts that we experience. If we turn to our client, the fact is that even at full capacity, American construction does need Canadian lumber. That is a fact. Even if they have fantastic development, which we wish them, fair enough, those are the numbers. We have to keep that in mind to avoid going in a direction without being focused on those facts.

[Gurbux Saini, Liberal, Fleetwood—Port Kells, BC]

My second question is this. I think, maybe for political reasons, we have ignored the forest industry, because it employs 200,000 people today, plus those who are in other industries that depend on it. We have 9% of the world's forests in Canada, but we don't have a ministry at the federal level that says we need to be managing this forest in such a way. New Brunswick is a prime example. Why can't we have a ministry at the federal level that says, “We need to follow these regulations. This is what's going to make it competitive, and that's what needs to be done”?

I'd like to hear from you on that.

[Frédéric Verreault]

We do address this subject.

Ken, please go ahead.

[Ken Kalesnikoff]

All I was going to say is that my feeling is this current government is doing that. The sense that we're getting from Minister Hodgson through our work with Frédéric and the task force is that this is a priority for the federal government. I think that's very important.

[The Chair, Liberal, Terry Duguid]

A last quick word will go to you, Mr. Verreault.

[Frédéric Verreault]

The forest sector generates more contributions to the GDP than steel and aluminum. The forest sector generates more contributions to the GDP than automobiles across the country. In the report, we really focus on GDP—an obsession with GDP. The numbers are clear. Based on the numbers, the path is straight ahead to have policies that fit this contribution.

[The Chair, Liberal, Terry Duguid]

That's a nice way to end, Mr. Verreault, on the importance of the sector to Canada and to our economy.

Colleagues, on your behalf, let me thank our witnesses not only for appearing today, but also for all the work on the task force.

I can assure you this will be a very important consideration in the final forestry report that we issue. Again, thank you for your service to our country.

As we let our witnesses go, colleagues, I have a few things before we break.

Colleagues, this completes the testimony for the forestry study that we've undertaken. We are going to need recommendations for the forestry industry study to allow the analyst to draft a report over the summer. In discussion with the analysts and the clerk, we are suggesting Friday, July 3, as the date to receive recommendations from all members. How does that sound to you? It's a couple of weeks away.

[Some hon. members]

Agreed.

[The Chair, Liberal, Terry Duguid]

Then we have the energy export study. We're still looking for recommendations for that as well, by June 19. That would be this Friday. Of course, this is the energy export study. This was our first energy study, not the one that we're undertaking now, because that will carry over to the fall.

Finally, this is the last meeting before the summer adjournment period, and I wanted to take a moment. These meetings don't happen by magic. As you know, colleagues, we have amazing analysts here. We have a clerk, who will be moving on from—

Pardon me?

[Corey Hogan, Liberal, Calgary Confederation, AB]

You called them amazing and then you just called him “clerk”.

[Some hon. members]

Oh, oh!

[The Chair, Liberal, Terry Duguid]

He's leaving so....

To our fantastic clerk, Jean-Luc, thank you.

Of course, to all of the support staff, including our interpreters—where are they?

[A voice]

The interpreters are remote today.

[The Chair, Liberal, Terry Duguid]

They're remote.

Thank you, interpreters.

Of course, I want to thank all of you, colleagues. This has been, in my view, a constructive committee. I think we've generally got along and the exchanges have been respectful. There are different perspectives, of course, but I have certainly detected a lot of commonality and that is being reflected in some of our reports, so thank you for being a great committee.

With that, have a great summer, everyone. Thank you.