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Logging and Sawmilling Journal October/November 2010

April 2011

On the Cover:

After a dismal five years of declining lumber markets, forest companies and sawmills are starting to crank up production, primarily to meet growing demands for lumber in the Chinese market. Logging and Sawmilling takes a look—with the help of Canada’s largest wood products consulting firm, International WOOD MARKETS Group Inc.—at lumber production numbers in this issue, with the authoritative list of Canada’s Top 10 Lumber Producers.

(Photo of the Vanderwell Contractors (1971) Ltd sawmill in Slave Lake,
Alberta by Tony Kryzanowski)

Spotlight

The forest industry in Canada’s largest wood basket—the B.C. Central Interior—is working its way out of the doldrums, and there are now regular mill re-openings. But the result has been a labour shortage in the bush and at the sawmill.

The right equipment ingredients

Logging contractor—and ex-hockey player—Wade Fournier brings all the right ingredients to the table, starting with a modern equipment fleet and unique skills, particularly experience operating tilter feller bunchers and knowing how to safely harvest timber on steeper ground.

A harvesting equipment dream

Armand Landry’s dream of producing a purpose-built tracked harvester has come true with the development and production of the Landrich harvester—and four of these very efficient and productive harvesters are now at work in New Brunswick and Quebec.

Drying Lumber with Solar Power

In British Columbia, a pilot project using a solar hybrid kiln to dry lumber has delivered good results—and offers the potential of savings for a forest industry that is always looking to cut its energy costs.

Canada’s Top Lumber Producers –
West Fraser on top

Logging and Sawmilling Journal’s authoritative ranking of Canada’s largest lumber producers—who’s up and who’s down in lumber production.

Canadian companies exploring the Indian wood market

Tech Update – Skidders

Logging and Sawmilling Journal has the latest information on what’s new with skidders in this issue’s Tech Update.

Supplier Newsline

The Last Word

It’s time to jump-start the B.C. Forest Service—not bury it, says Jim Stirling.

 

 

 

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Canadian companies exploring the Indian wood marketCanadian companies exploring the Indian wood market

Canadian forest companies are looking at potential wood markets in India, and with a free trade arrangement in the offing, there are predictions that overall trade between Canada and India could quadruple—to $15 billion—over the next five years.

By Jim Stirling

Canadian forest companies are looking more closely at the potential marketing opportunities for their products offered by India.

The phenomenon is an understandable extension of the nightmare collapse of the housing market in the United States and it’s buoyed by continuing development in the Chinese market for Canadian and especially British Columbian manufactured wood products.

Other factors come into play. This country is home to a significant population of successful Indo-Canadians. And the world’s most populous democracy is negotiating with Canada for a Comprehensive Economic Partnership Agreement, a kind of free trade arrangement. When it fully kicks in, business experts predict bi-lateral trade between Canada and India will—during the next five years—almost quadruple to $15 billion.

Discovering what all that might mean for B.C.-based forest companies was a factor behind a recent exploratory trip to India involving Paul Newman, executive director of market access and trade with the Council of Forest Industries (COFI), based in Vancouver.

“We’d been receiving lots of questions from industry and different levels of government about whether there’s a strategy for India. We needed to get there and assess some fundamental market issues,” prefaces Newman. And the results? Well, nothing is immediately definite and that’s understandable given India’s huge and diverse economy.

Predictions and expectations at this very preliminary stage are punctuated with qualifications and ‘but yets’.

“Through the lens of other markets—like Japan, China and Korea—India is clearly different,” declares Newman. “It has a history and preference for wood (use) but almost exclusively for hardwoods, and teak in particular. Teak supplies are under a variety of threats all impacting availability and costs.

“As a consequence, India is forced to look at alternatives.”

Tempered hardwoods are one of those alternatives and Newman notes U.S. companies are working actively in that area. “I think B.C. coastal hardwood species will have opportunities, especially in the shop factory grades,” he says.

As for softwood, he reckons it comprises about three per cent of total imports. “There is some SPF coming in but it’s not a replacement for teak.” Most of the SPF imports are in radiata pine destined for the utility construction and the framework sectors, he adds.

Is India likely to become a Mecca for wood frame house construction? “Probably not,” according to Newman. But yet, the country does like wood, he continues. “With softwood, it’s probably a case of finding niches in decorative uses for wood,” he anticipates. At least, in the near future.

Newman was accompanied on the India mission by Brian Zak, a phyto-sanitary expert with the Canada Wood Group. COFI has been combining forces with the Canada Wood Group for several years in the area of market development initiatives, including considerable and continuing work in China. Newman and Zak scheduled meetings in Delhi with the ministries of agriculture and commerce. On the agenda was Indian import schedules which determine what wood product species are permitted into the country. It seemed some spruces and cedars were on the prohibited list in error, explains Newman.

During their meeting, Newman and Zak appeared successful in giving the Indian authorities the necessary assurances the species in question fully complied with India’s phyto-sanitary health and access standards for permissable entry and began the reinstatement process.

Newman reports that throughout their meetings with their Indian hosts, officials seemed open, candid and interested in what Canadian wood producers might be able to offer.

Wood product sizes required in the Indian markets could be a challenge for some Canadian producers, notes Newman. Transportation is an additional issue facing potential Canadian wood exporters. There could be a transportation disadvantage compared to competitors in Europe when the costs of shipping utility and low grade wood products from Canada are factored in, points out Newman.

“We now have to decide what the next steps should be,” he says by way of summation. The level of interest in India toward what Canadian wood product manufacturers can offer the country was clearly demonstrated, he continues. Exchanges and Indian delegations to Canadian trade shows and visits to sawmills and other processing centres here are likely to be encouraged and more frequent, anticipates Newman. India is for Canadian wood product producers very much a work in progress but one with intriguing possibilities for companies interested in further diversifying their marketing opportunities.

For Canadian wood product producers, the India market is very much a work in progress. But is has intriguing possibilities for companies interested in further diversifying their marketing opportunities.

India market now on the radar screen

Building trade relationships with India has been on the radar recently for several Canadian jurisdictions. Trade delegations have visited India from the federal, provincial and municipal levels. Four provinces—Quebec, Ontario, Saskatchewan and B.C.—have all launched recent trade missions to India.

Earlier this year, a delegation from the City of Surrey, in B.C.’s Lower Mainland, spent 11 days in India visiting seven cities to help develop new trading relationships. An estimated 27 per cent of Surrey’ s population is of Indian origin making it a good fit for such trade relationships, says Dianne Watts, Surrey’s mayor.

The mission’s main purpose was to generate economic development for Surrey and by all accounts exceeded expectations. Representatives from four regional lumber companies were mission participants.

Don Quann, chief financial officer with Mill & Timber Products Ltd., was among them. In a news release Quann said: “I strongly believe in three years’ time the mayor’s efforts along with those of the companies on this trip will result in significant volumes of lumber sold to the massive Indian market. The sacred ‘bull’ market is on the move.”

 

 

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