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Mayor’s Report – April 13, 2016

April 13, 2016

 

I had promised myself not to write another column any time soon on forestry. But I’m at another Council of Forest Industries (COFI) conference and forestry is the backbone of our local economy. Surrounded by producers, regulators, law makers, foresters, haulers of chips, builders of machines, and virtually every other business or profession related ever so casually to forestry, what can I do? I am compelled to write. My fingers twitch if I don’t turn them loose on the keyboard.

Listening to economists (not to be confused with paying them any attention) is always one of my favorite pastimes. I don’t suppose they have any measurable influence on how the economy performs, economic performance probably being primarily a function of you and me and the things we buy or forget to buy, but it is good to walk away with three or four points of view from a pair of presenters. By their own admission, the profession of economist was created to make astrologers look good and within their professional ranks they boast of three categories: those who can count and those who cannot count.

That said, the fact that our bread and butter grows on trees should give us pause to reflect on the viewpoints of those who make it their business to follow and study the trends in the forest industry from governance and regulation to planning and harvesting through production, sales, distribution, and utilization of the products of the forest. (No, I haven’t forgotten silviculture.)

Economic trends are shifting from month to month, maybe from day to day, so following them is an art as well as a science and a statistical wonder. For instance, we learned that we are entering a period of strengthening markets which won’t necessarily apply in 2016 during which we can expect disappointing growth.

Our local economic prosperity largely depends on the behaviour of the Americans where numbers of persons per household are decreasing (resulting in the need for more housing) while simultaneously the 25-35s are starting to wake up and think they need their own roofs. All this will put additional pressure on the industry. However, it seems that the industry is gearing up to meet the challenge with increased capacity.

There are also increasing challenges from other directions. Newsprint production has decreased by 55%. (Notice the vanishing newspapers.) The sale of chips to the pulp mills has been a major contributor to the prosperity of the local sawmills. Those of us who can remember the mid 70s may recall the mountains of chips at the local mills – chips that were sold to pulp mills. That never ceased, but a major reduction in demand for pulp will flow back and back to affect the viability of the lumber producer.

Government and industry have their work cut out to find ways to keep the forestry business profitable in the face of new and stimulating challenges. No doubt these challenges will be overcome; we may have to pay the cost.

 

Merlin Nichols, Mayor