2014 COFI Conference

There’s excellent reporting and analysis on several of last week’s COFI Conference presentations in the industry news feed at Wood Business here.
Informative Session #6 meanwhile, which explored the future trends and demand for existing wood products in Asian Markets, Emerging Markets, and North American Markets, seems largely untapped – so I will summarize:

Asian Markets – Paul Newman, Executive Director Market Access and Trade – COFI

Paul presented a thorough analysis of what’s happening offshore. I jotted down his list of “market drivers” presently for Japan and China:


  • Constrained by demographics and regressive immigration policies
  • 2011 disaster lingers – national energy policies, tight labour force
  • Strong motivation to increase wood penetration in non-housing segments – low carbon policies
  • Offset by aggressive promotion of national forest resources at the expense of imports.


  • Central government policies to ‘cool’ real estate markets is hitting mainstream development (“is ‘cooling’ a hopeless task?”)
  • Government declares war on pollution
  • Low carbon/green growth strategies gaining prominence
  • Trend toward green building (eco cities = “master-planned communities incorporating multiple layers of green technology”).

Emerging Markets – Zoish Bengali, Director, India Market Development – Forestry Innovation Investment Ltd.

The FII website tells us that as part a new market development strategy for India launched in 2012, FII opened an office in Mumbai “to provide on-the-ground assistance for the B.C. industry.” Much of the market research Ms. Bengali touched on in her captivating presentation is available in greater detail here. She cited six challenges for BC wood products in opening up the India market:

  1. Highly fragmented market
  2. Tarrifs – logs vs lumber
  3. Bureaucracy – LoC/Documentation
  4. Lack of sophistication and awareness
  5. Logistics – time to market
  6. Internal infrastructure.

North American Markets – Chris McIver, VP Lumber Sales and Corporate Development – West Fraser Timber Co. Ltd.

Chris questioned the 1.1 million U.S. housing starts forecast this year due to severe winter, labour and capital constraints, and shortage of buildable lots. He suggested that demand will improve more slowly than previously forecast (“I’m not sure we’re going to see a lumber super cycle”). He acknowledged that Canadian shipments to China puts more pressure on North American markets. While Chris reported that rail car issues have had a bigger impact on shipments than the Port Metro Vancouver truckers strike, lasting fallout from the port is of greater concern (he cited three factors critical to selling offshore: price, on-time delivery, and trust). Transportation is a major challenge (“fewer trucks, more and more expensive – industry needs to collectively address trucking and rail issues”). And pointing to this Canadian Fibre Supply chart, he noted fibre supply will continue to tighten, while suggesting this tightening “bodes well” for industry. When questions were welcomed from the audience, I asked Chris why, aside from price pressure, he viewed dwindling timber supply as a good thing for industry? How does that bode well, I wondered? Chris answered by stating “it was a fair question” before suggesting that as an industry we have been dealing from a position of oversupply for some time, perhaps alluding to salvage logging of Mountain Pine Beetle-killed wood.



When I introduced myself to Anne Giardini, President, Weyerhauser during a coffee break at the conference, she asked “And what do you do?” When I explained that I was with Dakeryn Industries, “a wholesale distributor”, she said “We need wholesale distributors.” A positive affirmation from a major producer.

During the CEO panel which concluded the conference, Ted Seraphim, President & CEO, West Fraser Timber, said that of three macro factors he follows (US housing market, production capacity, offshore markets), capacity has the greatest influence. The CEO panel featured an interesting exchange between Seraphim and Giardini; when Seraphim suggested that the single family house in the U.S. is trending bigger, Giardini promptly responded “I wouldn’t celebrate the growth in size of the single family house – that is not the sustainable, multi-family model of the future.” When a question from the audience expressed dismay at wood fibre (biomass opportunities) left in the bush, Giardini responded “We all have a shared obligation to make best use of the resource.”

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s