AAC Reduced in PG

The announcement of a 33 per cent reduction in the annual allowable cut (AAC) in the Prince George Timber Supply Area is no surprise. Back in 2011, the AAC in Prince George was temporarily elevated for salvage-logging operations. Five years later, at the 2016 COFI Convention, Tim Sheldan, Deputy Minister, B.C. Ministry of Forests confirmed that “most of the economically harvestable beetle-killed timber has been harvested.”

According to the news release, the measurable real impact on economic activity is expected to be less significant in consideration of average timber harvests in recent years. The effective cut reduction is 8 per cent. Even so, industry observers and lumber traders could rightly be wondering about longer term implications for markets, domestic and foreign, at the same time as trade issues remain unsettled.

There’s no doubt we’re coming closer and closer to the point where the cuts will be reduced. There will be less timber.
– Dave Peterson, B.C. Chief Forester (21 Nov. 2014)
See: Beetle Boundaries

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Seven Questions for the Cariboo Fire Centre

In the heart of B.C.’s beetle zone, the Cariboo Fire Centre covers an area of about 10.3 million hectares divided into three zones: Central Cariboo, Quesnel, and 100 Mile House. Headquartered in Williams Lake, it is one of six provincial wildland fire centres operated by the world-renowned B.C. Forest Service Wildfire Management Branch. Special thanks to Emily Epp, Fire Information Officer at the Cariboo Fire Centre, for taking the time to answer seven questions:

  1. In consideration of the low snow pack that is being reported in the mountains this year, does this increase the risk factor for wildfires this summer?
    Snow pack levels are one means of forecasting whether we’ll see an early or late start to the fire season. However, they aren’t a good indicator of how intense the season will be. More relevant indicators are precipitation levels and drying patterns as we move into summer. The nature of the fire season will ultimately depend on the arrival (or absence) of the “June rains”.
  2. What steps, if any, are being taken in advance preparation for this summer’s fire season?
    Throughout the spring and early summer, Wildfire Management Branch personnel focus on training and preparation for that upcoming fire season. Our fire fighters are highly skilled and trained to fight wildfires. Resources are positioned throughout the province in readiness for any level of fire activity that the season may bring.
  3. Are there specific areas that pose greater than normal or heightened risk for wildfires this season?
    The Fire Danger Rating is currently “Moderate” across most of B.C., with scattered areas of “High” in north, central, and southern B.C. The current long-term outlook for the summer indicates a potential for higher-than-normal temperatures. However, warmer than normal conditions alone are not necessarily an indicator of an intense fire season. While long term weather models may indicate trends over time, they cannot reliably forecast more than a few days in advance. We maintain our levels of preparedness by studying forecasts which will give us a good idea of what to expect in the short term. For looking more than a few days into the future, these forecasts have a diminished level of reliability.
  4. Is beetle-killed timber exacerbating the threat or risks this season?
    Recent wildfire observations over the past few fire seasons (2006-2011) have confirmed aggressive fire behaviour in MPB-affected forests. More information is being collected to validate potential and expected fire behaviour across a range of MPB-attacked forest fuel classes. The Wildfire Management Branch is working with communities, local governments, and First Nations to implement community wildfire protection plans in MPB-affected forests to address fire safety issues from the provincial MPB infestation.
  5. Are there any indications of industry taking any special steps in preparing for this fire season?
    By law, forest licensees are required to have hazard abatement plans in place and necessary wildfire suppression equipment on hand when working in the forest.
  6. What kind of budgets are in place for fighting anticipated fires this season? How does this compare with recent years? Is the number mentioned adequate in your opinion?
    For budgeting purposes, the government of B.C. has allocated $63 million in Direct Fire for the 2015/2016 fire season. When actual costs exceed the Direct Fire budget allocation, the Wildfire Management Branch has statutory authorization to receive additional funds. In the past 10 fiscal years (2005/09 to 2014/15), net Direct Fire costs have ranged from a low of $47 million in 2005/06 to a record high of $382 million in 2009/10. In fiscal year 2014/2015, WMB spent almost $298 million. It’s difficult to forecast wildfire suppression costs as each season varies significantly depending on weather conditions and the number and severity of wildfires that we respond to. The province will always spend what’s necessary to protect people and property.
  7. Are there other resources (equipment, personnel) that are being added this year? Are such resources in place now?
    This fact sheet details the resources the province has in place to fight wildfires this year:
    https://news.gov.bc.ca/factsheets/factsheet-forest-fire-prevention-is-everyones-responsibility

 

2015 COFI Convention – 25 Takeaways

  1. Most oft-used word at the convention: Certainty. Canfor CEO Don Kayne said China wants supply “certainty”. A member of the audience questioned how we provide that “certainty” to China in view of the Tsilhqot’in Supreme Court of Canada ruling. In another session, B.C.’s Chief Forester Dave Peterson said there’s been considerable “uncertainty” since 2000 regarding impact of the mountain pine beetle. “All these pieces of uncertainty are gone.. we’re past the point of doing math.. we know what it has done” (730 million cubic metres of timber killed). In his Forest Minister’s Address, Steve Thomson suggested working toward “certainty” on the provincial land base is a government priority.
  2. Second most oft-used word at the convention: Integrated. Integrated harvest regime, integrated forest bioeconomy etc. etc. “Bioproducts have the highest likelihood of success when integrated with existing primary timber conversion,” said Rod Albers, Manager Energy & Bio-Product Development at West Fraser. Lignin can be “re-integrated” into engineered wood products.
  3. You can make anything with lignin except money.
  4. Third most oft-used word at the convention: Partnerships. A key theme across all panelists.
  5. There’s a looming shortage of biomass in B.C. “We run out in 2023/2024/2025.” (Murray Hall Consulting)
  6. Dr. Trevor Stuthridge, Executive Vice-President FP Innovations confirmed the bioeconomy is the fastest growing economic sector in the world. The title of his presentation “Will Canada and B.C. play a role in the bioeconomy?” remains an open question.
  7. Torrefaction – the process of roasting and toasting – is not unique to Starbucks. Roasting wood into biocoal is now the 2nd generation of wood pellets (Jerry Ericsson, President of Diacarbon Energy Inc.)
  8. Dwindling fibre supply projections/forecasts/assumptions in the B.C. Interior are based on current management/conventional thinking. Are there ways that we can re-define current management?
  9. “More contraction” is a nice way of saying mills shutting down.
  10. “Biomass is everything that’s left over after everybody’s used everything they want” – Murray Hall Consulting. “There is no sawmill waste left – lets stop talking about it as an untapped source of bioeconomy growth.”
  11. Sandy Ferguson, VP Corporate Development at Conifex confirmed substantial work has been completed to resolve the equipment failure at the Conifex bioenergy plant in Mackenzie. Start-up date TBD.
  12. “Look out for China,” warned Brendan Lowney, Forest Economic Advisors. “I’m more nervous about China than I’ve been in many years,” added Russ Taylor, Wood Markets Group.
  13. “I can guarantee you 1.5 million U.S. housing starts but I can’t guarantee when” – Brendan Lowney
  14. “It’s impossible to forecast housing starts” – Russ Taylor
  15. Cost structure is changing in B.C. = rising log costs.
  16. Four shiploads of European lumber set sail for the East Coast in January. Changes in exporting countries FX resulted in 15% drop in SPF #2&Btr prices in China (Nov 2014-Feb 2015). There is reportedly now “little room for lower prices on Russian and European lumber,” according to Russ Taylor.
  17. Ecosystem-based management = balancing economic, environmental, and human well-being.
  18. Dallas Smith, President and CEO Nanwakolas Business Corp, and Nanwakolas Council, is one compelling speaker.
  19. The future of high-rise construction is wood. The proposed 18-storey wood-frame tower at UBC would be the tallest wooden building of its kind in the world.
  20. Oliver Lang, Partner at Lang Wilson Practice in Architecture, was the only speaker who addressed “urban culture” and the trend toward multi-family home construction in this urban context. While the moderator likened Lang’s presentation to “trying to drink water from a fire hose”, it was riveting. While wood is the sustainable, green building material, traditional single-family home construction is not the sustainable model of the future.
  21. “Minimizing waste created by our activity is a primary global environmental and social objective.” – Chief Forester Dave Peterson. “Given future sawlog supply reductions, it’s a very tricky balance point between the interests of existing and potential fibre users.”
  22. “There is no question we have fibre supply challenges.” – Mark Feldinger, Canfor
  23. China used more cement in the last three years than the U.S. did in the 20th century (FEA)
  24. Truck driver shortages are worsening. Only 12% of for-hire drivers are under the age of 30. Canada could experience a shortage of 25,000-33,000 for-hire drivers by 2020. (Matthew May, BST Transportation Group)
  25. This year’s CEO panel discussion featured Ted Seraphim, West Fraser and Don Kayne, Canfor. In a convention packed with punch, count this blogger among many who left that hurried luncheon session disappointed. The seated ‘fireside chat’ was void of any meaningful content beyond vague, shared “optimism” about the future.

Beetle Boundaries

With 18 million cubic metres of the land base having been attacked and killed by the Mountain Pine Beetle, the unprecedented and unsustainable salvage operation in the B.C. Interior continues.
What, exactly, will the future look like? That’s what “everyone wants to know,” confirms B.C.’s Chief Forester Dave Peterson. In my conversation with Dave on Friday, I learned that “there’s no doubt we’re coming closer and closer to the point where the cuts will be reduced.” And while annual allowable cut (AAC) forecast slides were a prerequisite of any super cycle presentation, I learned from Dave that definition of beetle-killed timber supply areas is highly region-specific, shaped by a number of variables.

  • Reality is “there will be less timber”
  • While we are “forward-looking as possible” we “don’t predict future AAC.. cuts are set area by area for 5-10 years at a time”
  • Cuts are very much predicated on the area, dependent upon definitive information including site conditions and also kinds of sawmills there (“are they well-suited for cutting small dead trees?”)
  • Beetle-killed trees last longer in dry areas – in wet areas, the roots rot and the trees eventually fall over (the “tipping point” where timber is no longer economic)
  • Timber Supply Review (TSR) of the 100 Mile House Timber Supply Area (TSA) and Mackenzie TSA most recently completed and AAC adjusted
  • Williams Lake TSR will be completed within two months (“still a significant amount of dead timber in Williams Lake and West Chilcotin”)
  • Quesnel and Prince George Timber Supply Reviews to be completed in 2015 or early 2016

“It is well to remember that there are no new forests to be found. All are known. From here to eternity, Canadians must do with what they have.”
– G. Herbert Lash, horticulturist. “A Walk in the Forest” (1966),
issued by the Canadian Pulp and Paper Association

The “Decade of Forestry”

That’s how Dr. Lynn Michaelis, president of Strategic Economic Analysis and nationally recognized forestry economist, describes the next 10 years.

The market trends he identifies in today’s Albany Herald are familiar (increasing housing starts in the U.S., growing fibre deficit in China, shrinking fibre supply in Canada). What’s more thought-provoking (if not deflating, in the face of beetlemania in B.C.) is the certainty with which he predicts that the Southern U.S. forest products industry will be the big winner. Echoing much of what Interfor’s Martin Jurvasky told us back in April, Michaelis explains just how Georgia’s abundance of trees is poised to fill the gap.
See: Forest business gives Georgia solid lead.

“It’s all about capacity.”
– Ted Seraphim, President & CEO, West Fraser Timber,
at the 2014 COFI Conference

Climate Change and Beetles

The ongoing impact of beetle-killed forests continues to make news. A five-year project headed up by B.C.’s leading universities is learning that forests killed by the mountain pine beetle are hampering the ability of the province’s 55 million hectares of forest to capture atmospheric carbon. In a Vancouver Sun column by Randy Shore today, we’re told “the combined effect of the pine beetle on lost carbon storage activity and emissions from decay in the dead pine forests exceeds carbon emissions from all other sources in B.C., about 65 million to 70 million tonnes of carbon dioxide equivalents.” The Pacific Institute for Climate Solutions (PICS) is one of the leaders in the project, pulling together the intellectual capital of the province aimed at integrating multi-disciplinary approaches to climate change.

We’re told that climate change scenarios are complicating the work of forest management and regeneration while presenting opportunities to understand what future forests might look like. It’s serious business. Climate change includes realities of what is described in the report as a climatic ‘comfort zone’ for some species of trees seen shifting north. How soon could it be that orange groves dot the landscape from Quesnel to Chetwynd?

“Through the ’90s, B.C. forests were a net sink for carbon, storing far more than would be emitted by fossil fuel burning. Since the spread of the mountain pine beetle, they have become a net carbon source. That’s because hundreds of millions of trees are no longer able to take up carbon, but are just decomposing.”
– Werner Kurz, lead scientist, Canadian Forest Service

Beetle Invasions

In 1964, it was a different kind of beetles invasion when the phenomenon that became known as Beatlemania struck North America. How ironic then that today, a pine tree planted in 2004 to honor former Beatle George Harrison has reportedly been killed — by beetles.

The memorial tree in Griffith Park, Los Angeles, had grown to more than 10 feet tall before the beetles took over, according to the L.A. Times: “The sapling went in, unobtrusively, near the observatory with a small plaque at the base to commemorate the former Beatle, who died in 2001, because he spent his final days in Los Angeles and because he was an avid gardener for much of his adult life.” Date for replanting TBA.

Could it be that Paul McCartney’s hit “Yesterday” was about a time when there were no concerns about the spread of any ‘beetlemania’?