Tag Archives: Forest Stewardship

Year-end Answers

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As the sun sets on 2023, you’ll recall 16 questions asked at Harderblog almost one year ago:

photo credit: ejharder 15 Dec 2023
  1. Will any updated data surface to corroborate our recent polling that 99.3% of lumber traders have no idea what you’re talking about when you mention culture wars?
    If the culture war or culture conflict refers to the conflict between traditionalist or conservative values and social democracy, progressive or social liberal values in the Western world, as well as other countries, 99.3% of lumber traders are mostly asking: “What has this got to do with the price of 2×4?”
  2. Will a rebounding ‘covid-reopened’ China account for two-thirds of global growth in 2023?
    According to reports in The Financial Times, despite expectations for a blowout rebound, China’s share has fallen in 2023, hitting 17%. That puts China on pace for a two-year drop of 1.4 percentage points, a slide not seen since the 1960’s and 1970’s, when Mao Zedong presided over a weak economy. With its current slide, China will account for none of the growth of global GDP over the past two years, estimated at a total increase of $113 trillion.
  3. Will Russia’s behaviour as a rogue state be the greatest global risk this year?
    While Time named Russia’s behaviour as a rogue state to be the greatest global risk in 2023, implications of Hamas-Israeli War in October merely added to burdensome list of global risk concerns by year end.
  4. In consideration of what some analysts call BC forest industry overreach, will 2023 be considered a “tipping point” in context of a fiber supply crisis?
    According to year-end reporting, BC Forestry Minister Bruce Ralston admits the industry is “going through change that has been a bit rocky.” And while admitting that fiber supply continues to be a hot button issue, he notes the province is “taking many steps” to put the industry on a sustainable path for the future. “The annual allowable cut is coming down just because of the fires and the mountain pine beetle and most of the beetle wood has been logged in the last 10 years or so.” We may well look back on 2023 as the “tipping point”.
  5. Will wood pellets still be considered “sustainable biomass” by the end of 2023?
    We were told ahead of the November COP28 climate talks there is clear evidence wood pellets are increasingly produced from logged whole trees from primary forests in B.C. Whether or not wood pellets are still considered “sustainable biomass” remains an open question.
  6. Will global catastrophic weather-related events trigger a heightened sense of urgency around action on the climate emergency?
    According to the World Resources Institute State of Climate Action 2023, “This year’s State of Climate Action finds that progress made in closing the global gap in climate action remains woefully inadequate – 41 of 42 indicators assessed are not on track to achieve their 2030 targets.” Data as recently as end of November indicate that 2023 is on track to be the hottest year humans have ever experienced, and by a wide margin according to most data sets. September, for instance, was warmer by a larger amount than any month measured by NOAA in 174 years.
  7. What sporting event will deliver up the greatest upset in result this year?
    If you’re a cricket fan, it was Afghanistan defeating defending champions England by 69 runs at the ICC Men’s Cricket World Cup 2023. If you’re a Canadian Football League fan, it was the Montreal Alouettes last minute heroics in upsetting Winnipeg Blue Bombers to win the Grey Cup. Beyond that, just too many upsets to mention.
  8. Will the rise in eco-friendly materials in construction find new relevance and impact in the lumber industry?
    Yes. According to new reporting at Medium.com “As the demand for sustainable building materials continues to rise, the Reclaimed Lumber Market is experiencing significant growth. The market is driven by a combination of environmental consciousness, the desire for distinctive and high-quality products, and the increasing emphasis on green construction practices. Additionally, as the construction industry evolves towards greater sustainability, the Reclaimed Lumber Market is poised to play a pivotal role in shaping the future of eco-conscious building materials.”
  9. Will AI find newly-perceived value in construction in ways that impact the lumber industry?
    Yes, AI is impacting all industry. It will add value in ways that we can only imagine at this point. We’re told that the virtual assistants and chatbots, computer programs, are providing information and learning to recognize contextual patterns to provide better responses over time. These programs simulate written or spoken conversation in lieu of human interaction. Its development is bound to lead to enhanced productivity even for lumber traders working from home offices.
  10. Will advancements in robotics find surprise new application for lumber trading floors in search of stepped up efficiencies and motivational strategies in enhancing customer services?
    As far as we know stepped up efficiencies and motivational strategies for lumber trading floors are not significantly being served at this point by robots clamoring for new-found relevance in 2023. Any bots delivering non-stop coffee or blood mopping from trading floors are still in their planning stage.
  11. Euro softwood lumber export volumes to the US accelerated in 2022, while BC exports to the US declined (CIBC Capital Markets). Will this trend continue in 2023?
    Updated 2-21-24: “Euro imports slipped to 1.97 billion board feet in 2023, down from the record 2.03 bbf shipped in 2022. Prior to 2023, European shipments to the U.S. had increased eight consecutive years from a 2014 trough of 126 million board feet. Shipments jumped 27% in 2022 compared to 2021.” (Source: Random Lengths International)
  12. Will we experience a recession in 2023?
    The jury is still arguing over whether Canada and/or the US is in recession. All reports suggest we are “skirting” recession on both sides of the border at year end.
  13. Will there be a dramatic new breakthrough in the medical field that captures more attention than NASA’s planned space missions?
    For space buffs, the moon was “the hottest ticket in town” in 2023. It included India’s successful landing there, while NASA’s news of launching the most powerful rocket ever is precursor to prepping four moon walkers for upcoming planned landings. Richard Branson’s Virgin Galactica started taking tourists on short rides to space in 2023. Many medical breakthroughs including new drugs to slow Alzheimers and new ultrasound for cancer therapies giving new hope to men with prostate cancer, are among 2023 medical breakthroughs, even as they may not have captured the same press as moonwalkers in training. Lumber traders confirm there were no lumber prices aboard rockets to the moon in 2023, and there were no breakthrough drugs to heal pains of overpriced lumber inventory.
  14. Will new polling reveal that people are becoming bored of raging on social media?
    At least one response at Forbes noted: “Are we stupid? Not really. We’re human. Social media apps know that we’re all trying to seek attention and we’re all information seekers. We want to be informed and we want to inform. The problem is that this digital treadmill keeps running forever, and there’s never an end in sight. That’s really the whole point of social media, to convince us there’s a goal and at the same time never allowing us to reach the goal. It’s perfectly alluring.” So expect the ‘raging’ to continue, even as people become increasingly bored with it.
  15. Will the January 1st imposition of a two-year ban preventing foreigners’ buying into Canada’s housing market result in more affordable housing for Canadians?
    No. According to Canada’s housing and infrastructure minister, Sean Fraser, the ban on non-Canadians buying homes is offering weak evidence of alleviating the affordable housing crisis in Canada. “It is a wrongheaded approach to addressing the crisis.”
  16. Will most lumber industry associates we know maintain their lumber trader’s characteristic cheerful disposition by year end?
    The Pew Research Center reports that 51% of American workers are “highly satisfied” with their jobs. Meanwhile, in Canada, the November primary indicator was up a tad from October’s 47% satisfaction. So, of course, it’s evident that overall lumber traders have maintained their cheerful disposition among the 20% of America’s workforce who indicate “passionate satisfaction” about their jobs in 2023.

16 Questions for 2023

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  1. Will any updated data surface to corroborate our recent polling that 99.3% of lumber traders have no idea what you’re talking about when you mention culture wars?
  2. Will a rebounding ‘covid-reopened’ China account for two-thirds of global growth in 2023?
  3. Will Russia’s behavior as a rogue state be the greatest global risk this year?
  4. In consideration of what some analysts call BC forest industry overreach, will 2023 be considered a “tipping point” in context of a fiber supply crisis?
  5. Will wood pellets still be considered “sustainable biomass” by the end of 2023?
  6. Will global catastrophic weather-related events trigger a heightened sense of urgency around action on the climate emergency?
  7. What sporting event will deliver up the greatest upset in result this year?
  8. Will the rise in eco-friendly materials in construction find new relevance and impact in the lumber industry?
  9. Will AI find newly-perceived value in construction in ways that impact the lumber industry?
  10. Will advancements in robotics find surprise new application for lumber trading floors in search of stepped up efficiencies and motivational strategies in enhancing customer services?
  11. Euro softwood lumber export volumes to the US accelerated last year, while BC exports to the US declined (CIBC Capital Markets 9 Jan. 2023). Will this trend continue in 2023?
  12. Will we experience a recession in 2023?
  13. Will there be a dramatic new breakthrough in the medical field that captures more attention than NASA’s planned space missions?
  14. Will new polling reveal that people are becoming bored of raging on social media?
  15. Will the January 1st imposition of a two-year ban preventing foreigners’ buying into Canada’s housing market result in more affordable housing for Canadians?
  16. Will most lumber industry associates we know maintain their lumber trader’s characteristic cheerful disposition by year end?

20 Questions for 2020

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Here are 20 questions that Harderblog will be watching this year, in search of answers:

    1. Will billionaire Jimmy Pattison succeed in taking Canfor private before his 92nd birthday on October 1, 2020?
    2. Will volumes of reduced fibre made available to sawmills from BC woodlands be outstripped by fibre consumed in Shredded Wheat?
    3. In this age of emerging technology, will tech gadgets surface that invite even lumber traders to investigate their perceived practical value?
    4. Will the US standoff with North Korea find resolution before the Softwood Lumber Dispute between Canada and the US?
    5. Will the financial bull markets of the last decade continue to roar in 2020?
    6. Will economic disparity between the haves and the have-nots show signs of narrowing?
    7. Will a recovery in lumber prices postpone more production curtailments and permanent sawmill closures in BC?
    8. Seedlings for forest revitalization in BC are forecast to rise from 270 million seedlings in 2019 to a record 310 million in 2020. How many trees will be planted?
    9. As the market for sustainable mass timber construction grows, how many more cross-laminated timber (CLT) plants will open in North America this year?
    10. Will shipment volumes of European lumber flood the Northeast US market as some analysts project?
    11. Is integrity still considered to be the core quality in evaluating services delivered by lumber wholesalers?
    12. Will the Broadway revival of The Music Man starring Hugh Jackman later this year reprise its Tony winning best musical of 1957, when it enjoyed a run of 1375 performances?
    13. Will Home Depot succeed in reducing the rise in millions of dollars worth of goods stolen from the chain by organized criminals?
    14. In overtaking Toronto as the most expensive city in Canada, will Vancouver maintain that position in 2020?
    15. Will an old growth protection strategy be established in BC?
    16. Will there be significant evidence of steps being taken to counter negatives impacting climate change?
    17. Will there be a cooling in the ideological struggle that exploded in Hong Kong in 2019 between Hong Kong rule of law and Beijing rule of law?
    18. Will clues of democracy giving way to authoritarian governments become more pronounced in 2020?
    19. Will John Bolton publish a book that contains information deemed to include “explosive, new revelations”?
    20. Is Donald J. Trump still president at the end of 2020?

Scribbles from the 2019 COFI Convention

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1. Convention buzzwords: innovation, inclusion, sharing, partnerships, relationship, certainty, predictability, capacity (ability), conservation, caribou

2. “A new model of forest management.”
– Doug Donaldson, Minister of Forests, Lands, Natural Resource Operations & Rural Development

3. “China-U.S. negotiations are only a small subset of the larger tensions.”
– Robert Johnston, Managing Director, Global Energy & Natural Resources, Eurasia Group

4. “India and Southeast Asia will become more important for Canada’s forest sector than China.”
– Robert Johnston

5. “There are very few world leaders that are fierce defenders of globalization.”
– Robert Johnston on the “G-Zero World”

6. “Shareholders are having a stronger influence than governments on climate action – it’s very tough to get climate policy in a context of populism.” – Robert Johnston

7. “Where do we get growth from in the Canadian economy when the drivers are cooling? Productivity innovation.”
– Jock Finlayson, Executive Vice President and Chief Policy Officer, Business Council of B.C.

8. “We’re in a low interest environment for as long as the eye can see. How will policy makers respond next time we move into a recession world?”
– Jock Finlayson

9. “We have seen a dramatic decrease in consumption.”
– Chris McIver, Vice President, Sales & Marketing, West Fraser

10. “The use of wood in appearance applications is growing.”
– Don McGregor, Vice President of Sales & Wholesale Supply, Western Forest Products

11. “There were 487 mass timber projects in 2018. In 2013 there were five.”
– Bart Bender, Senior Vice President, Sales & Marketing, Interfor

12. “It’s always easy to get a deal if you’re prepared to get a bad deal. This is not a good time, we’ll have to wait until the circumstances are right.”
– David MacNaughton, Ambassador of Canada to the United States

13. “Consumer groups have very little political clout (in the U.S.). I’ve been very surprised in observing this fact.”
– David MacNaughton

14. “Nothing unites Republicans and Democrats more than unfair trade with China.”
– David MacNaughton

15. “The U.S. sells more goods to Canada than China, Japan, and Great Britain combined.”
– David MacNaughton

16. “Our relationships with the U.S. are strong and deep.”
– David MacNaughton

17. “The data lake is turning into the data swamp. Everything we do is about clarifying the complex.”
– Charles Lavigne, CEO & Co-Founder, LlamaZOO

18. “How to build relationships with Indigenous communities? Go in without an agenda.”
– JP Gladu, President & CEO, Canadian Council for Aboriginal Business

19. “(On caribou recovery) there will be active engagement with communities (this week) and natural resource sector parties.”
– Beth MacNeil, Assistant Deputy Minister, Canadian Forest Service

20. “Under the previous government, forestry was an engine that was allowed to take over. The status quo is not acceptable. There are high expectations for the industry to make changes.”
– John Allan, Deputy Minister, Ministry of Forests, Lands, Natural Resource Operations & Rural Development

21. “We all know what the problem is in the Interior; we have too much capacity and too few trees.”
– John Allan

22. “There is desire on the public’s part to regain some control of forestry and the management of old growth on Vancouver Island.”
– John Allan

23. “We’ve lived up to our commitments (caribou recovery) but we’ve been a bit late coming to the communities.”
– John Allan

24. “I am shocked and disappointed by what is happening this week (in Chetwynd). Without consultation, how are we going to get through these cycles? It discourages future investment in B.C.”
– Ted Seraphim, President & CEO, West Fraser

25. “I hope he (Horgan) talks about our industry in such a way that it attracts young people.”
– Ted Seraphim

26. “Government to government relationship is key in China. China values relationships even moreso. We can’t get complacent, we need to refocus, continue these trade missions to get the message to the Asian markets.”
– Don Kayne, President & CEO, Canfor

27. “The biggest driver is wood costs. B.C. has the highest wood costs in North America. With B.C. as our base, we needed to expand, grow our diversification in Europe and the U.S. South.”
– Don Kayne

28. “Next year, the forest products industry is expected to have 7300 openings. Youth are the future of forestry, embrace them. Offer opportunity, growth, reasonable pay. Promote economic stability, work life balance, and social consciousness. Create a respectful and enjoyable workplace. If I identify and prove that there’s a better way to do something, will I be encouraged to pursue it?”
– Fiona McDonald, Communications Specialist, Conifex Timber Inc.

29. “The problem with just posting a job is you skip the first two steps of the marketing funnel (Awareness and Interest, before Desire and Action). Get out in front of prospects rather than waiting for the prospect to come to you.”
– Quinn Miller, Energy Engineer, West Fraser

30. “How to motivate young professionals? Engage new perspectives and break down barriers. Encourage mentorship and knowledge sharing. Support through continued learning and education.”
– Ethan Griffin, Production Superintendent, Interfor

31. When we talk about reconciliation we need to reconcile our relationship. Consent does not mean veto. Consent is shared decision-making. We have to get to a place where we can make decisions together. The fibre basket is shrinking, the AAC is coming down everywhere. How do you want this arrangement? How do you want to access that fibre?”
– Terry Teegee, Regional Chief, B.C. Assembly of First Nations

33. “It’s not about a final agreement. It’s about relationship, moving forward together.”
– Celeste Haldane, Chief Commissioner, B.C. Treaty Commission

34. “It always amazes me how often I get asked the question ‘What’s the best way to start a relationship?’ Pick up the phone. There’s something that intimidates people about having that conversation.”
– Doug Caul, Deputy Minister, Ministry of Indigenous Relations and Reconciliation

35. “At the Youth Outland Employment Camp (OYEP) West, Indigenous youth build confidence, establish networks, learn how to work both independently and as a group, and develop a keen understanding of workplace expectations.” See: 2018 OYEP sponsorsOYEP StatsOYEP West – 2019 Partnership Package
Derek Orr, Business Development Manager, Carrier Lumber

36. “The forest industry is the most innovative sector in our economy.”
– John Horgan, Premier of B.C.

37. “A negotiated settlement (SLA) would have been preferable, but that’s not possible.”
– John Horgan

38. “(On coastal forest revitalization) we’re not going to just take down our forests to move them down to other jurisdictions where they can extract the value.”
– John Horgan

39. “The situation in the Interior is deteriorating but there are opportunities. We’ll approach it TSA by TSA. How do we add value, not how do we allocate timber supply. It’s about how do we take our dwindling fibre basket and maximize the value. The process is evolving but it is not prescriptive; if I prescribed a solution it would be inadequate.”
– John Horgan

40. “I always talk about value-added and (the big producers) say ‘we can smell the incense when you start talking that way.. we need markets!”
– John Horgan

41. “More high value, less high volume. I’m going to give you the incentives you need to transition between high volume and high value. These are opportunities, not obligations. It’s on you to take this challenge.”
– John Horgan

Wooden It Be Loverly

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“Wooden it be loverly”, words from My Fair Lady ring true to a lumber trader’s ear.. even though Professor Henry Higgins may say it’s meant to say “wouldn’t”.
Today, another ‘would‘-related story is music to our ears (see: Guitar maker champions use of local woods).

It’s the Vancouver International Guitar Festival, upcoming in early August. The Vancouver Sun reports that some of the world’s top luthiers will be on hand “to present guitars crafted entirely from local BC woods such as Sitka spruce, red cedar, curly maple – perhaps even reclaimed or salvaged woods.”

The “local wood challenge” holds particular interest here in BC, which reportedly supplies 80 per cent of the tone wood to the global guitar market. While Englemann and Sitka spruce are two of the province’s most sought-after species, Dave Nadin of Bow River woods in Chilliwack notes a growing interest in other domestic woods.

It’s reported that while earlier guitar shows highlighted flashier guitars made of rosewood and mahogany, demand for locally-sourced wood is on the rise with an eye to sustainability and protection of natural resources. We’re told it’s the way of the future. Meanwhile, as long as Willie’n the boys make music, would or wouldn’t not guitar afficionados trust the chords to ring true, no matter what lumber’s in play.

~~~

Images from a family hike in the woods last week at beautiful Golden Ears Provincial Park:

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Lumber Sales Therapists

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Studies have shown that spending time in nature can improve mental and physical health. According to the Richmond News (see article here), Ken Ouendag experienced the healing power of nature firsthand and wants to help others through the work as Vancouver’s first certified forest therapy guide. Ouendag says: “I’ve always believed there’s so much good in spending time in nature and so often I’ve kind of questioned why.”

It got us thinking that the adage of “What’s in a name?” might have relevance for lumber traders. Could lumber distributors’ service to mills and retailers be enhanced by reconstituting the function, at least in name, from full-service lumber wholesalers/lumber traders, to freshly-minted lumber sales therapist? Could the reshaping of therapeutic images of walks in the woods and precursored connections of all things wood tied to forest antecedents add value as lumber sales therapists. Could it add a dimension of stability and healing to frantic trading environment for 2×10? Or, at least, ease the pain for buyers – lending comfort in times of unseasonably strong markets amid concerns about duties and constrained fibre supply.

Studies have shown that volatile lumber markets can induce stress. Does this not summon up recognition of  inherent value of lumber’s roots in the forest’s calming and healing qualities? Can we not recognize therein the lumber trader’s transcendental potential as sales therapist? Some say it summons up the poetry inherent in the trade. Think of Robert Frost conjuring overbloated inventory of 2×10 back to the product’s time as a tree; of the missed phone call not heard if it rings in the forest. Remember the soothing call of “Timberrrr!” in the woods, enduring storms of nature, strong – calming, albeit bold as an Emily Carr painting. Summon the poetry in the perfect sales presentation that finds expression for a ‘win-win’ characterization in its perfection. Any lumber sales therapist up to speed in current tools of the trade still finds power in Robert Frost’s Two Roads that diverged in the woods, even as he ponders over the one not taken.

As certified forest therapy guide, Ouendag engages in specific practices declaring that walks in the woods help people practice mindfulness through sensory awareness facilitated by various activitities. “The first one we tend to do is called ‘what’s in motion?” It’s inviting you to walk very slowly and to take note of what’s in motion around you. “When people do start slowing down they start noticing cobwebs that are blowing in the breeze or a salmonberry bush where the leaves are blowing slightly.”

The lumber sales therapist might expand on these exercises aimed at countering inaction or lack of motion, as in when market activity dies, and sense of panic ensues, triggering propensities for onset of early happy hour. Relax, take a deep breath, envision a salmonberry bush – make reaching for a cold one a cold call instead.

Another exercise Ouendag suggests as forestry threrapist is called a “sit spot” which involves finding a space and sitting there for 15 to 20 minutes. It encourages people dealing with grief to “sit with themselves and feel supported by the nature around them.” The equivalent exercise for the lumber sales therapist for assuaging late shipment anxiety might recommend accessing nearest trading room exit, in search of a quiet brooding spot outdoors (in nature) for tearfully cursing CN Rail. Ouendag says the sit spot exercise he employs as forest guide therapist is similar to the corpse pose in a yoga session and is followed by a tea ceremony.

The lumber sales therapist seeks to enhance and heighten sense of well-being by imposing woods-imbued virtual imaging, while avoiding cable news.

The redefined  lumber sales therapist’s role recasts the essence of selling and buying as a spiritual experience with mind-altering techniques aimed at reinforcing 2×10’s recently held association with nature. It’s well known that some have miscast lumber trading as a religious experience, by brushing off late shipments, citing unhelpful comments such as “Not to worry, In the end we’ll all get to heaven”. For starters though, it may all come back to what’s in a name. Some contend that a name means everything. There’s a saying that “What you call a boat determines how it will sail.” William Shakespeare said that which we call a rose by any other name would smell as sweet. Against the backdrop of news story morphing wilderness guiding into ‘certified forest therapy guide’, it’s perhaps not a stretch for creatively adaptive lumber traders to envision enhanced service opportunity in rebranded role as lumber sales therapists.

– Post by Ernie Harder

Sharpening the Saw

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Its been said that there is power in staying connected to other people in your industry. My fifth consecutive B.C. Council of Forest Industries (COFI) Convention, held in Prince George last week, provided again opportunity to return with ideas to sharpen skills and stay abreast of a rapidly-changing lumbering landscape. The listed takeaways include a surprise at how few marketing and sales types were among more than 550 delegates who packed the Prince George Civic Centre for agenda presentations:

-The prevailing politically-charged environment these days seemed to shape tempered viewpoints from panelists on several fronts. Folks looking for Interfor President & CEO Duncan Davies to deliver pertinent softwood lumber dispute insights were disappointed. His confirmation lauding the work the Softwood Lumber Board is doing to grow softwood lumber demand did not excite. Fortunately a pointed question from the audience, asking why Canadian producers would support the SLB when a number of U.S. members are working to constrain market access, elicited topical response: “The tariffs are wrong. Whether or not the economy is helping to soften the blow, the tariffs should not be there. Inspite of trade matters, we need to continue to invest in our biggest market.” From West Fraser President & CEO Ted Seraphim: “Today, we’re not worried about the softwood lumber dispute. But if the market were weaker, we’d all be worrying about it. So we need to grow demand.”

-While there wasn’t a panel discussion dedicated to timely transportation concerns, Federal Minister of Transport Marc Garneau addressed the situation. He said CN and CP need to do better. He pointed to Bill C-49 (Transportation Modernization Act) but his reporting an improvement in railcar capacity for grain fell flat among an audience concerned with lumber shipments. From Beth MacNeil, Assistant Deputy Minister, Canadian Forest Service: “Without infrastructure, there is no trade.”

–Jock Finlayson, Business Council of B.C., talked about the uncertain, shifting economic landscape in this province. He referenced the impact of uncertainty on investor confidence and how Canada is lagging in healthy capital formation. He sees little upside in residential construction in Canada, while pointing to “fundamental organic demand for housing growth” in the U.S. 30-39 age group. He suggested recent fiscal stimulus in the U.S. is unnecessary and poorly timed. Presently 300,000-400,000 manufacturing jobs in the U.S. are unfilled.

-According to Paul Jannke, Forest Economic Advisors (FEA), the U.S. labour force is the single biggest constraining factor in U.S. sawmill production.

-It was refreshing to hear from B.C.’s new Minister of Forests, Doug Donaldson, but otherwise nothing noteworthy recorded.

-An excellent presentation by Kevin Pankratz, Senior VP, Sales & Marketing, Canfor addressed export markets and the global outlook. Interesting to learn that the R&R market is bigger than new home construction. Expansive growth in hybrid construction, off-site construction, and building automation in all markets reported. “Governments everywhere will increase focus on green building initiatives to meet emission targets.”

-Most edgy presentation (“Fibre Supply – It Is What We Make It”) goes to Diane Nicholls, now two years into her job as B.C.’s Chief Forester. In the aftermath of the Mountain Pine Beetle, she seemingly referees the constant fight for access to quality fibre, further complicated by the Spruce Beetle presently eating into the midterm timber supply.

-The Forestry Jobs for Today and Tomorrow panel might have been one of the highlights. Best moderator of the convention goes to Sandy Ferguson, VP Corporate Development, Conifex. It was interesting to hear industry (Canfor/Interfor/Tolko/West Fraser) is working to rejuvenate parts of the BCIT Wood Products Manufacturing Program I graduated from, which has been dormant since 2003. From Kara Biles, Manager Learning & Talent, Canfor: “Aggressively advocate for diversity and inclusion in your company; diversity is a competitive differentiator shifting market share toward more diverse companies.” Derek Orr, Business Development Manager, Carrier provided update on planning underway for a Ranger Program aimed at development/training of Aboriginal youth. Lots of sponsor traction for the program including Carrier, Dunkley, Conifex, West Fraser, and Canfor.

–Premier John Horgan seemed pleasantly surprised with the warm welcome before delivering his keynote speech Friday morning: “Thank you for clapping.” He deftly navigated the politically-charged minefield.

~~~

At first glance, the 2018 COFI Convention struck me as perhaps being lighter on content in comparison with past years. However, on second glance, it was rich in both content and opportunity, with plenty to digest. As one among four delegates from Dakeryn Industries, I again return from this convention with new and enlightening ideas. For us all, it was a worthwhile time to ‘sharpen our saws’.

Premier John Horgan with COFI President & CEO Susan Yurkovich (6 Apr 2018)

Year-end Answers

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As we approach year-end, you’ll recall 17 questions for 2017 we posed one year ago at Harderblog:

1. (See Question #1 from 2016)
Yes.

2. Will Trump really build a wall and have Mexico pay for it?
No. It’s reported the promised border wall amounts to eight prototypes sitting in a desert outside San Diego. Mexico hasn’t contributed a peso and no funding has been appropriated by Congress to advance the project beyond the testing phase.

3. Will the softwood lumber dispute have found a satisfactory resolution?
At the 2017 COFI Convention in Vancouver, David Emerson, B.C.’s Trade Envoy to the United States, described the ongoing softwood lumber dispute as “a mutating form of bacteria that has all but become antibiotic-resistant.” In the face of a dwindling resource and increasing demand for softwood worldwide, effective today the combined CVD/AD duty paid by most Canadian importers to the U.S. Customs and Border Protection Agency will be 20.23%, calculated on the selling price.

4. Will anticipated countervailing duties on Canadian softwood lumber shipments to the U.S. be applied retroactively?
No. While the USDOC concluded in April that “critical circumstances” existed (justifying the charging of duties retroactively 90 days), by early December the USITC had announced a negative finding concerning critical circumstances.

5. Will Trump really pull the U.S. out of the Paris Climate Change Agreement?
Yes.

6. In the face of “Fake News” and misinformation that poses distraction to sound decision formulation on many fronts, will lumber dealers lean more heavily than ever on trusted wholesale relationships to interpret market changes?
A poll of traders in Dakeryn’s office says “yes” to this question.

7. Will Trump really pull the U.S. out of the Iran Nuclear Deal?
No.

8. Will there be 100 million consumers shopping in augmented reality (AR) by the end of 2017?
Maybe not yet. However we’re told here “shoppers are beginning to give AR more attention, particularly when viewing function-driven, feature rich, high-consideration purchases such as furniture. Voice technology, augmented reality, and artificial intelligence are transforming the retail industry to make buying products quicker, easier and more enjoyable.”

9. Will a measure of sanity return to the Vancouver housing market?
No, although, as a major news story, rental-housing woes in Vancouver eclipsed angst over the climbing cost of homeownership. In 2017, it’s reported the average rent for a one-bedroom apartment listing in this city surpassed $2,000 per month.

10. Will the record number of homeless people identified in the City of Vancouver’s 2016 Homeless Count be broken again in 2017?
Yes. The record-breaking 2,138 homeless people counted in Vancouver this year is 291 more than the previous record of 1,847 homeless people counted in 2016. At 448, Aboriginal peoples are once again over-represented in the number of homeless people living in Vancouver.

11. Will tensions with China escalate over trade and Taiwan?
Trade issues loomed large on many fronts in 2017. The U.S. opting out of the Trans Pacific Partnership headlined trade-related news in Asia.

12. In light of increased hacking of connected products, will questions surrounding cybersecurity have become a make-or-break issue by the end of 2017?
Yes. In fact 2017 has been described as “the year of cybersecurity wake-up calls”. Recent examples show disturbing trends.

13. Is there any indication that by the end of 2017 a future of driverless transport trucks could promise enhanced just-in-time lumber deliveries?
See Corrections.

14. Will anybody care if the Vancouver Canucks fail to make the Stanley Cup Playoffs?
Vancouver Canucks attendance figures are said to be the lowest since 2001.

15. Will BC Premier Christy Clark’s Liberal Party secure a fifth term in May?
No.

16. Will the global crises surrounding issues of displaced peoples/refugees have eased anywhere?
See: Why nothing will stop people from migrating.

17. Will general predictions forecasting a “bumpy ride” for 2017 come to fruition?
See: Are you day trading?

2017 COFI Convention – 26 Takeaways

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1. Convention buzzwords: shift (in fibre supply), declining (timber quality), instability (of supply), balance, diversification, value, engage, relationships, confidence, communication, connecting, collaboration

2. Most important trend shaping the global environment: dramatic expansion of the global middle class.
Jock Finlayson, Business Council of B.C., bemoaned Canada’s “slow-moving jurisdiction in a fast-moving world.”
The American economy continues to advance. Over the medium term, “B.C. needs to address a number of important structural weaknesses that threaten our prosperity”.

The whole problem with the world is that fools and fanatics are always so certain of themselves, and wiser people are so full of doubt.
– Burtrand Russell

3. Historical devaluation of the Ruble triggered significant investment in state of the art sawmilling equipment in Russia. Currency-based advantage led to surge in softwood exports to China. Notion that Russia has an aging, limited infrastructure, is wrong. There are no logistical cost issues in Russia.
– Russ Taylor, President, Wood Markets

4. Russia has Forest Stewardship Certification (FSC). “Don’t ask me how.” – Russ Taylor

5. The panel assembled for the International Markets Review was a rare convention disappointment. U.S. homebuilding constraints are well-known. U.S. housing starts forecasts have become tedious. As for China, when Eric Wong, Canada Wood Beijing Office, warned that B.C. is losing softwood market share, no alarm bells sounded at the Vancouver Convention Centre. Growth in demand offshore is “continual” according to Wong, attributed in part to logging bans in China’s “natural forests” (25 million cube/year harvest reduction). Record softwood imports in 2016 in China >32 million cubes. In a post-beetle world, at least one trader was left wondering if B.C. (“the global resource for softwood,” according to architect Michael Green) should just go off the market.

6. India will be the 5th largest consumer market by 2025. 60% of the population in India is <35.
– Peter Bradfield, Forestry Innovation Investment

7. “The concept of innovation is.. what are you going to do with all of this growing information? Big Data connects people, like us, to the brilliance in the room”. Challenges facing the Big Data Revolution: Volume, Velocity, Variety, Veracity.
– Rory Armes, Founder & CEO, Cumul8

8. “Innovative technologies will help attract tech-savy video gamer kids who aren’t considering a resource-based industry.”
Mark Gerberman, AR/VR Strategic Partnerships & Business Development, Finger Food Studios

9. How can we keep better track of our natural resources using emerging technologies? We need better data and better analysis tools.
In the future, drone technology and remote sensing will identify the log and the mill, and determine the optimal products and customers – before that tree is felled. “We’re working to offer the industry a turn-key drone.”
– Mike Wilcox, Co-founder/COO, Spire Aerobotics

10. “It’s Urban Wood Building instead of Tall Wood Building.”
– Michael Green, Principal, MGA 

11. “Instability of (wood) supply makes people step back.” – Michael Green

12. “Changing the public perception about what’s possible.. reshaping public perception.. is the challenge. But it’s really happening. These ideas are not abstract. Thirty storeys? When we do that or will we do that remains to be seen, but it’s possible.” – Michael Green

13. “The construction industry is broken.”
– Michael Green

14. “Here in B.C., we may be making the right products but we need to be part of the right system. The idea is universal. We want to be leaders in becoming part of this ‘system’ thinking.” – Michael Green

15. TOE = Timber Online Education. Open access to leading experts.. “from forest to frame”. Free global education in wood design, construction, policy, markets, ownership, and environmental impact.

16. “We didn’t blockade because we wanted to stop the forestry, we wanted to be a part of it.”
– Chief Derek Orr, McLeod Lake Indian Band

17. “The Tsilhqot’in decision was a game changer. When I first meet with a chief, it better not be to ask to build a road. We’re there to undertake their unique vision for their community. What is your vision? Under-promise and over-deliver. If you don’t honour one of those commitments then your relationship goes backwards.”
– Karen Brandt, VP, Corporate Affairs & Sustainability, Interfor

18. “Engage and engage early. Meaningfully engaging with First Nations is how you build relationships. If you’re too busy to sit down with us, then we’re too busy to give you support.”
– Willie Sellars, Councillor, Williams Lake Indian Band

19. “I like to think Prince George is the Bio Energy capital.”
– Lyn Hall, Mayor, City of Prince George, who confirmed the COFI Convention returns to PG next year.

20. “The urban and rural connection, not the urban and rural divide.”
– Greg Moore, Mayor, City of Port Coquitlam
21. “Reinvesting in our business to innovate and modernize the technology in our mills isn’t about making more lumber. We’re not going to make more lumber. We’re going to make more value. Industry and government need to get together to get more value out of a scarce fibre resource.”
– Ted Seraphim, President & CEO, West Fraser

22. “How to run at two shifts efficiently instead of three shifts is the challenge. Three shifts are not possible.” – Nick Arkle, Co-CEO, Gorman

23. “(The softwood lumber dispute) could lovingly be called a hardy perennial. But it is a mutating form of bacteria that has all but become antibiotic-resistant.”
– David Emerson, B.C.’s Trade Envoy to the United States

24. “The consumer will pay the price.” – Duncan Davies, President & CEO, Interfor

25. “The softwood file is top of mind for the entire government. We have a strong case but that’s cold comfort for the people feeling the pain of the imposition of duties. A good, strong, fair, mutually-beneficial deal is preferable to long litigation. On both sides of the border, trade is central to maintaining standard of living. Trade creates jobs.”
– Kirsten Hillman, Assistant Deputy Minister, Trade Policy & Negotiation, Global Affairs Canada

26. Q: Is a market share-based quota inevitable?
A: “Nothing is inevitable.” – Kirsten Hillman

COFI Countdown

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The sold out COFI 2017 Convention kicks off at 6:30pm this evening with an ice breaker in the stunning wood-infused architecture of the Vancouver Convention Centre. The largest gathering of the forest sector in Canada, we’re told over 600 delegates are registered this year, making this the biggest COFI Convention in ten years. The annual meeting brings attention and awareness to the significance of forestry to the economic well-being of the province. This year’s theme is Forestry for the Planet. Forest Products for the World.

The convention’s jam-packed itinerary ensures plenty to capture our attention through Friday. Tomorrow’s keynote speaker is renowned architect Michael Green who will present Increments of Change: from early tall wood buildings to a global movement. I’m also looking forward to the International Markets Review in the morning, and an afternoon CEO panel featuring Nick Arkle (Gorman Group), Duncan Davies (Interfor), Don Kayne (Canfor), and Ted Seraphim (West Fraser). On Friday, David Emerson, BC Trade Envoy to the United States, will discuss Canada’s Trade Negotiations Agenda with Kirsten Hillman, Assistant Deputy Minister, Trade Policy & Negotiation, Global Affairs Canada.

There’s a ton of other interesting panel discussions before we hear from BC Premier Christy Clark, keynote speaker at Friday’s closing luncheon. Speaking of politics, it’s interesting today to look back in the blog archives at Premier Clark’s keynote at the COFI 2013 Convention, a fiery speech which seemingly sparked her campaign’s comeback, leading to a surprise victory in the provincial election the following month.

A good preview of the COFI 2017 Convention is available in the podcast below. It includes a number of hard-hitting caller questions for Susan Yurkovich, COFI President & CEO. My 23 takeaways from last year’s excellent COFI Convention in Kelowna are available here.