Mr. Speaker, I represent a riding that has over 50% of the product of softwood lumber within the confines of my riding. Therefore, I trust I am qualified to make some of the remarks that I am planning to make today.
I have phrased my remarks around what I call a tale of two cities. More precisely, I think this is a story of two small, single industry towns in northern Ontario, Schreiber and Terrace Bay, about 10 miles apart. They are on the Trans-Canada Highway and border the north shore of Lake Superior.
Although I use those two communities as examples, I think that I am also talking about 350 other communities right across this country that are dependent on the forestry industry and are single industry towns. When I talk of Schreiber and Terrace Bay, it is not exclusive.
Both are majestic little communities in a wonderful setting with all of the natural beauty of any community located in this scenic area. Schreiber had its genesis about 100 years ago as a railway town and has serviced the CPR since that time. Even today the CPR passes through Schreiber, but with a greatly reduced labour force. Some years ago, Schreiber relied on several mining companies, which were successful for a short time, but when the mines were depleted they closed and the miners and their families left the community, leaving only one major industry, that being Kimberly-Clark, a producer of kraft paper.
The reason for Terrace Bay's existence was the Kimberly-Clark organization in the United States. Its most famous product, as we well know, is Kleenex. The raw material, known as kraft, was produced in Terrace Bay. Kimberly-Clark decided to build this plant on the north shore of Lake Superior right after the second world war, mainly because there was an abundance of natural resources, with plenty of trees and a lot of water, which were so necessary.
Terrace Bay became the showplace on the north shore, an almost perfect single industry mill town employing almost 1,000 men and women from Schreiber and Terrace Bay. Terrace Bay developed because of this a great school system, a small well-run hospital, beautiful parks, a hockey rink, which we know is so important to every small town, a curling rink and a community hall. It developed a devoted and dedicated town council to run its affairs. There was everything a small community needed. Terrace Bay became home to many families. After working there throughout their careers, as in Schreiber, the people decided to retire there to stay in Terrace Bay and they left their assets within the community.
Kimberly-Clark, over the 50 years it operated, was an enlightened and empathetic employer and kept investing in the progress of the mill over those 50 years. As it is in all businesses, the forestry industry was going through some change. There was a marketing change. Costs were increasing. There was an ownership change. There was more offshore competition. About five years ago, Kimberly-Clark decided to sell its Terrace Bay operation to Neenah Paper. Neenah Paper was a company with its head office in Atlanta, Georgia.
Neenah ran the Kimberly-Clark operation for about five years. Then its board of directors decided to sell the Terrace Bay operation. It was not a good time to sell the forestry business. Markets were being devastated with high costs, offshore competition, the high cost of fibre and the high cost of energy. The value of the Canadian dollar was going up, making our product less competitive.
Although there was interest shown by the softwood producers, they were having their own problems of liquidity and were fighting for survival because of the ongoing softwood lumber dispute with the United States. Most of the softwood industry in Canada was simply out of money and had exhausted all lines of credit with the banks.
About a year ago, Neenah Paper announced, because it could not find a buyer, that it would permanently close the Kimberly-Clark paper mill in Terrace Bay and issued layoff notices to its employees in both Terrace Bay and Schreiber.
Devastation and despair settled into those communities. Men and women who had worked for years were out of a job. They had absolutely no prospects of any future jobs in those particular areas. Some left the communities for prosperity in Alberta and some returned.
The town councils, led by able, competent mayors, Mike King in Terrace Bay and Donald McArthur in Schreiber, did everything within their power to keep these communities together. We owe both mayors a tremendous vote of appreciation and gratitude. Can anyone imagine trying to run a small community where the largest property owners are vacating? How do they continue to provide the services, education, health care, policing, maintenance and public utilities without a proper tax base?
The residents of those communities, from firsthand knowledge, were devastated. Their life savings, mostly in the homes they had bought over the years, were now worth a small fraction of their original cost. Unfortunately, even if they wanted to sell their homes, there were no buyers within these communities. Everything they had worked for all their lives was lost. It was a disaster.
About six months ago there was a glimmer of hope. The government announced a break in the longstanding softwood lumber dispute with the United States and began negotiating a settlement with our friends in the United States. It stopped the lengthy, expensive litigation process and decided to negotiate a deal, a return to the softwood lumber producers in Canada of almost 80% of the $5.2 billion paid by the Canadian producers to the Americans.
On the announcement of that, private negotiations were resumed between Neenah Paper and a company called Buchanan Forest Products, which owns several mills, the largest softwood producer in Ontario as a matter of fact and the largest private employer of men and women in northern Ontario. The rest is history.
Last Thursday the Buchanan group of companies officially took ownership of Neenah Paper in Terrace Bay. Last Saturday, for the first time in six months, the first shipment of Kraft left Terrace Bay and was shipped to the United States. Orders are starting to come in on a daily basis.
The first shipment left after six months. It was a sight to behold, with the Ontario minister of natural resources present, the family owners, Kenny and Ken Buchanan, and their board of directors, made up of local people with a local interest, Russell York , Yves Fricot, Wolf Garrick and Hartley Multimacki all on board. All the inside workers at this mill were present at the opening of this mill.
There were tears of joy. I have never seen this in my life. There were tears of joy at the opening of the new mill in this single industry town. This would not have happened without the agreement with the United States on softwood lumber. That is why, along with some other reasons, I supported, voted for, still approve of and will continue to vote in favour of the softwood lumber agreement with the United States.
I am very proud to have represented the overwhelming desire of the constituents I represent in Schreiber, Terrace Bay and, indeed, throughout northern Ontario.
My only hope is that some of that same good fortune that we have experienced in Schreiber and Terrace Bay, because of the industriousness of these folks and the willingness to negotiate, will happen in the other 350 communities across the country that depend on the forestry industry for support and for existence.
That is the end of my story on the Tale of Two Cities.