What's the Forest Industry Worth to BC? - Old Growth Strategic Review: What It Means for Contractors - Interior Logging ...
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[ INSIDE How Will BC Grow Its Value-Added Without the Wood? ] www.tla.ca Winter 2021 What's the Forest Industry Worth to BC? Old Growth Strategic Review: What It Means for Contractors PM # 40010419
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WINTER 2021 Volume 43 Number 4 www.tla.ca CONTENTS 46 25 Columns & Departments 7 TLA President's Message 20 Market Report Measured Decisions That Will Work for All US Market Outlook and Supply Dynamics Bill Nelson Russ Taylor 8 TLA Executive Director's Message So, Exactly What is Our Message? Bob Brash Cover 10 Southern Interior Perspective Now the Work Begins 46 What's the Forest Industry Worth Todd Chamberlain to BC? TLA Editorial 13 North West Perspective Ready for Opportunities in 2021 Rick Brouwer Features 14 Northern Interior Perspective 22 Forestry Community: Williams Lake Old-Growth Management in the Interior Robin Brunet Paul Schuetz 24 Letter to the Truck Loggers Association 16 Business Matters Premier John Horgan Working with First Nations Chris Duncan and Mindy Wight 25 How Will BC Grow Its Value-Added 18 Safety Report Without the Wood? Ian MacNeill Use Three Points of Contact Every Time to Reduce 30 BC's Old Growth Strategic Review: the Risk of Injury Mark Ordeman What It Means for Contractors Jim Girvan 35 Suppliers' Supplement Cover Photo: Courtesy of Bill Nelson Winter 2021 Truck LoggerBC 3
The Truck Loggers Association Interior Logging Association 2020 Executive & Directors 2021 Board of Directors PresidentBill Nelson Chairman Ron Volansky Vice PresidentAaron Service First Vice Chairman Tim Menning Past President Jacqui Beban Past Chairman Randy Spence Executive DirectorBob Brash Directors Guido Claudepierre Industrial DirectorsSig Kemmler Dennis Cook Bob Marquis John Drayton Dave McNaught Creole Dufour Jen Norie Randy Durante Mark Ponting Frank Etchart Aaron Service Erin Fitchett Barry Simpson Sue Hagarty Dorian Uzzell Reid Hedlund Matt Wealick Scott Horovatin Lennard Joe Associate Directors Tyson Lambert Hedley Larsen Tim Lloyd Don Mathews Brian Mulvihill Shawn McIver Carl Sweet Shari Smaha Lawrence Van De Leur Editorial Board Jacqui Beban General Manager Todd Chamberlain John Betts Administration Nancy Hesketh Bob Brash Rick Brouwer Chris Duncan Interior Logging Association Trevor Jobb 3204 - 39th Avenue Sig Kemmler Vernon, BC V1T 3C8 T H A N K YO U TO T H E T LA A N D I TS M EM B ERS FO R YO U R Jennifer Kramer Brian Mulvihill Tel: 250.503.2199 Fax: 250.503.2250 E-mail: info@interiorlogging.org C O N T I N U ED S U P PO RT O F T H E LO G G I N G C O M M U N I T Y Bill Nelson Website: www.interiorlogging.org Paul Schuetz ALM WOOD CONTRACTING Newcastle Timber Ltd. WINTER 2021 / VOLUME 43 / NUMBER 4 Editor Jennifer Kramer Contributing Writers Bob Brash Ian MacNeill Rick Brouwer Bill Nelson Robin Brunet Mark Ordeman Todd Chamberlain Paul Schuetz Chris Duncan Russ Taylor Jim Girvan Mindy Wight John Horgan For editorial information, please contact the Truck Loggers Association: TUG & BARGE Tel: 604.684.4291 Email: contact@tla.ca For advertising, please contact Advertising In Print: Tel: 604.681.1811 Email: info@advertisinginprint.com Truck LoggerBC magazine is published four times a year by the Truck Loggers Association, with content and support from the Interior Logging Association and the North West Loggers Association. Its editorial content seeks to reflect issues facing the industry and to provide readers with current information on BC’s forest industry. All rights reserved. Advertising Sales & Design Layout office: Advertising In Print 716 – 938 Howe Street, Vancouver, BC V6Z 1N9 Tel: 604.681.1811 Fax: 604.681.0456 ice. Goo o o d Se rv Company. Good People. G Publication Mailing Agreement No. 40010419. d For subscriptions, contact office@tla.ca or 604.684.4291. Send change of address notices and covers of undeliverable copies to: The Truck Loggers Association Tel: 604.684.4291 Suite 725-815 West Hastings Street E-mail: contact@tla.ca www.westcoasttug.ca Vancouver, BC V6C 1B4 Website: www.tla.ca 4 Truck LoggerBC Winter 2021
from the Editorial Board DESK... W elcome to the Winter issue of Truck LoggerBC maga- zine. On behalf of the TLA’s board of directors, I hope that you and your loved ones had a safe and joyful holiday season. Additionally, on January 13, the Suppliers’ Spotlight webinars feature TLA suppliers who will highlight their products and services, followed by a Q&A period; suppliers, times and reg- In this issue, Business Matters provides information istration information are listed on pages 26 and 35. about developing powerful partnerships with First Nations; Also, without a live and silent auction this year, the TLA the Safety Report reminds everyone to always use three is providing members with an online auction in support points of contact when getting in and out of your truck; and of the TLA’s Forestry Education Fund; donors and auction the Market Report provides a US market outlook and takes items are listed on page 43. a look at supply dynamics. As you pick up this issue, you’ll once again notice that it On the heels of October 2020’s provincial election, Premier is a few pages less and a few articles shorter than what we’ve Horgan provided a letter to the TLA, which includes his com- come to enjoy over the past few years, which remains a result mitment to moving forward with the policy and regulation of COVID-19 and the challenging times in the forest indus- changes resulting from the Contractor Sustainability Review. try. We understand and respect that our regular advertisers Following government’s release of its Old Growth Stra- need to make difficult decisions these days about where to tegic Review in September 2020, we provide an analysis of spend their advertising budgets and would like to express how it impacts contractors and reinforce the importance of our appreciation to those who have continued to support the logging sector’s engagement in future discussions. Truck LoggerBC magazine and the TLA. One of the greatest challenges facing the forest industry As we continue to experience the effects of the pandemic, is ensuring the public understands—and appreciates—how I hope that everyone continues to stay safe and healthy in the much logging financially infiltrates every one of its commu- coming year. As always, I trust you will nities. The cover article, “What’s the Forest Industry Worth find this issue insightful and informative. to BC?” provides data to support forestry’s economic con- If you have any feedback or comments, tributions to communities and highlights the obvious and please contact our Director of Commu- less obvious benefits that BC’s forest industry provides. nications Jennifer Kramer by email at Unique to this issue is the Suppliers’ Supplement. Without a jennifer@tla.ca. trade show this year, we wanted to ensure our valued suppliers Sig Kemmler still had an opportunity to share information with TLA members. Editorial Board Chair Forestry Equipment Hourly Rates | 2020 Available only to TLA and ILA members Why Use the Rates? • Independently built using forest industry data from equipment manufacturers and contractors that reflect actual operating circumstances. • Comprehensive forest equipment coverage. • Fuel price is adjusted monthly based on individual machine fuel consumption as opposed to generic fuel price changes. • Dynamic to changes when they occur that affect operating costs. • Used by BC Wildfire Service when hiring contractors. To obtain a copy: TLA members download from Members Login section on tla.ca; ILA members call the ILA office at 250.503.2199 | | | @truckloggerBC | www.tla.ca Winter 2021 Truck LoggerBC 5
Bill Nelson TLA President’s MESSAGE Measured Decisions that Will Work for All I would like to congratulate Premier Horgan on his party’s recent re-elec- tion and Katrine Conroy on her appoint- members to help chart a path forward for businesses and communities. Last year, in partnership with Timber- members-only section on the TLA web- site. We value our suppliers and want to ensure they still have an opportunity ment as BC’s new Minister of Forests, Tracks, the TLA launched the Forestry to reach out to our members, so in this Lands, Natural Resource Operations, and Equipment Hourly Rate Sheet to pro- issue we’ve included a separate Suppli- Rural Development. We look forward to vide the basic information needed for ers’ Supplement section and on January working with government on the many forestry equipment hourly rates, which 13, we are offering a one-day Suppliers’ challenges facing the forest industry in- were developed independently by equip- Spotlight webinar series. Also in Janu- cluding the high priority of moving for- ment manufacturers and contractors and ary, we are hosting an online auction to ward with the new rate dispute resolution reflect actual work-on-the-ground situ- raise funds for the Forestry Education mechanism coming out of the Contractor ations. A significant amount of research Fund to ensure we continue funding Sustainability Review. and work went into this initiative and scholarships for many deserving for- We also look forward to the work despite it not being perfect for all situa- estry students. that will need to be done on the socio- tions it is a reasonable place to start when Also a reflection of the times is a economic review of old-growth logging, developing a rate model or checking the change in our annual sponsorship. I which was an obvious miss in the recent hourly structure in your businesses. I would like to extend our appreciation Old Growth Strategic Review. It is so highly encourage TLA members to con- to Finning for the past nine years as our important to show how this is not just a sider using these rates. See page 5 for Premier Sponsor, previous five years as simple subject of cut or preserve. BC’s ac- more information about how TLA and our convention’s Gold Sponsor and pri- tive working forest is both old and new, ILA members can obtain a copy. or decades of sponsoring TLA events; and has multiple benefits generating far For those who are not already aware, I’d you will be missed. At the same time, I more than just stumpage to the Province, like to formally recognize the TLA’s new would like to thank Inland for joining as returns to contractors and profitabil- partnership with Wilson M. Beck (WM our new Premier Sponsor, building upon ity to licensees. An active working for- Beck) Insurance Services. Not much has their previous support of the TLA. est creates community stability, wages to actually changed, as it is the result of ac- We’ve also experienced a decline in thousands of employees, and economic count managers, Ben Fitzpatrick and magazine advertising, so I’d also like to returns to multiple supply chains across Peter Pringle, transitioning from Marsh extend our appreciation to all of the ad- the province. to WM Beck who will remain the TLA’s vertisers listed on page 45 whose support Tenure reform is another important main contacts. Wilson M. Beck is a sec- has enabled this issue to be in the hands topic for all stakeholders in the forest ond-generation western Canadian com- of our readers. industry. For almost eight decades, the pany with the ability to also provide ICBC Changes to the TLA’s funding struc- TLA has been calling for some type of insurance, which TLA members will ap- ture has caused the board to do some tenure reform and with so many issues preciate for a one-stop-shop option. Wel- deep inward reflection, have hard dis- around native land claims, old-growth come, Wilson M. Beck. cussions and make difficult decisions logging and protection, forestry commu- On the COVID-19 front, the TLA about the future. All discussions come nity stability and the need for certainty continues to deal with the pandemic, back to how the TLA can continue to on the land base to enhance investment, as does the rest of the forest industry provide maximum value to its members it would be hard to not conclude that and the world. We are all thankful that and are a sign of a healthy association there will be changes coming in our fu- forestry is an essential service and are that is willing to change. We always want ture. For contractors, this could be both proud to be a major contributor to BC’s to honour our history and tradition, but scary and an opportunity. The TLA will economic recovery. the industry and our members’ needs be urging government to make measured Without a convention in 2021 due change, and so too will the association decisions that work for all stakehold- to COVID-19, we have been forced to to meet those needs. As always, our ers. A one-size-fits-all approach will not look at everything differently and make strength is in our roots. work across the province and contractors changes to how we operate. We con- need to be considered fairly in any deci- tinue to provide industry information Bill Nelson, President, TLA sions that are made. and education through our new TLA Tel: 250-287-0045 Additionally, the TLA is working with TALKS webinar initiative; past webi- Email: bill.nelson@hdlogging.com mayors and leaders of TLA Community nars can be found online through the Winter 2021 Truck LoggerBC 7
Bob Brash TLA Executive Director’s MESSAGE So, Exactly What is Our Message? W ell, another BC election is com- plete, and we now know (to no- body’s real surprise) the government we Why are those our messages? In short, we could say it is because we believe in BC, our communities and the forestry is some ENGO’s reneging on previously negotiated land use plans by ever-esca- lating demands for outright protection of will be working with over the next four sector, but there really is an even simpler areas and consequential withdrawal from years as we tackle forestry sector issues. answer. To be successful, any business has working forests. Firstly, our appreciation to Premier the basic fundamentals to uphold: rev- Make no mistake; BC’s forest industry Horgan for his letter to the TLA in this enues, costs, margins, capital employed, is and remains a prominent force in the issue. Our association has always be- and certainties/risks moving forward; global market. We should collectively be lieved in working together with the gov- and therein lies the challenge for many proud of our accomplishments and con- ernments of the day to move our collec- participants in BC’s forestry sector. tributions to BC’s overall strength. Un- tive agendas forward. Luckily, most of Specific to harvesting contractors, re- fortunately, in concert with what all the the time, we share similar goals and wish cent studies and surveys confirm most independent forest investment analysts lists for the changes we believe are nec- remain challenged by the rates offered by are saying, the concerns we’ve described essary to improve the sector. The trick is licensees (and that is putting it diplomat- do not instill the needed confidence in to actually convert our messages into real ically). If rates are marginal or below the BC’s forestry sector to attract the neces- changes that benefit us all. effective costs of running an operation, sary capital and investment to move it To help the sector achieve this objec- that is clearly not sustainable, especially forward in the manner we would all like tive, we have a new minister. The TLA as we need to attract more youth. And to see. welcomes Minister Conroy to what we while I’m not defending the licensees, Is there a roadmap to success? Sure, consider (and perhaps a tad biased on our BC’s overall high-cost structure is out but the challenge remains in negotiating part) to be the most important—and es- of tune with our competitors globally, through the myriad of different agendas sential—ministry in BC. Our industry re- hence pressures by all concerned to save each group brings to our politicians. At mains a prominent employment genera- costs wherever possible. The net results the end of the day, perhaps we should all tor, the backbone of many communities for many in our business are very slim concentrate on the core issues: set up an and a huge contributor to government to non-existent margins, which sets up a environment whereby all the factors of revenues. Several articles in this issue difficult environment to find capital and costs, revenues, margins and certainty clearly demonstrate the magnitude and continually reinvest in our very capital- are improved. This means even looking scope of our industry. The new minister’s intensive industry. Add in the uncer- at our high stumpage level (sorry to our mandate letter contains many ambitious tainties many contractors face with the government friends). If these core re- goals; most of which we will do our best to degree to which their capital is employed alities are not addressed adequately, all support. The challenge for all concerned and the length of their operational sea- of the other solutions will probably be will be helping the minister navigate the son, and the margins become further moot. And let’s not be distracted by the wide breadth of varying agendas between strained. As a side note, the Contractor current good lumber markets; I’ve “been licensees, contractors, value-added man- Sustainability Review process remains a there, done that” in terms of seeing mar- ufacturers, environmental groups, com- critical component towards finding lon- ket cycles. Our future depends on being munities, and First Nations. ger-term solutions to rate concerns. well situated for all market conditions. So, what is our message? Over the Layered on top of these difficulties is If nothing else, BC’s loggers have years, we’ve been consistent with our the remaining—and at times escalat- shown an enormous capacity to adapt core messages: we’ve had enough of the ing—uncertainties of the working forest to change over the decades. Set up the constant erosion of the working forest; from two perspectives. Firstly, BC’s regu- environment for better success and we’ll we need to dramatically improve BC’s latory and permitting structures remain know our message has been heard—and investment climate; government needs complex with the consequential impacts we’ll take care of the rest. to provide far more certainty on the land of inconsistent harvesting approvals in base and regulatory environment; make many areas of the province. Secondly, Bob Brash, RPF, MBA, Executive Director, TLA the contractor community more sus- environmental groups continue to ad- Tel: 604-684-4291 tainable; and set up an environment to vocate strongly for increased protection Email: bob@tla.ca reduce our excessive high-cost structure of forest stands at both the global and compared to our global competitors. localized levels. Of even greater concern 8 Truck LoggerBC Winter 2021
Todd Chamberlain Southern Interior PERSPECTIVE Now the Work Begins T he dust has settled on the provin- cial election and we now know we have a majority NDP government. I tunity to have their opinion heard and respected. Contractors, like other stake- holders, can provide workable solutions to the chairperson role for the past four years; Randy will now assume the role of past chairman. I would also like to thank would like to welcome Katrine Conroy to based on their expertise and values. Our Len Gudeit for his years of service to the her new role as the Minister of Forests, board of directors is as always up for the ILA through his tenure on the board of Lands, Natural Resources Operations, challenge and will continue to assist gov- directors, Len has stepped down to allow and Rural Development; I look forward ernment in making decisions that have Erin Fitchett of A.F. Timber Co. Ltd. in to working with you. I would be remiss our members’ concerns considered as Nelson to join our board. Our new chair- if I did not thank all of those people, re- part of that process. man, executive and board of directors are gardless of party affiliation, for offering 2021 brings us a new year with new looking forward to working with the new up their names and making such a com- beginnings on all fronts and we at the forest minister and her staff to tackle the mitment for the people of British Co- ILA look forward to working with our many issues that affect our industry. lumbia. I would also like to thank Doug new forest minister to ensure that the We at the ILA hope that you and your Donaldson for all of the energy and effort working forests of British Columbia con- family had the opportunity to enjoy the that he put forward to assist our associa- tinue to provide for the people of British holiday season together and with your tions during his tenure as minister. En- Columbia. We will continue our strong friends. It is also our wish that everyone joy your retirement Doug! advocacy efforts on the issues that mat- had some much needed downtime before the big push to breakup time and that this I believe it is important that all of these issues are not new year brings safety and prosperity to you all. considered singularly when making decisions and that I look forward to being able to travel all of the stakeholders are given an equal voice prior to across the Interior again to meet with our members, old and new and to welcome decisions being made. everyone to our annual convention and It is the ILA’s hope that over the next four ter the most to our members and look trade show once again. COVID-19 has years, a majority government will bring sta- forward to the continued co-operation restricted our ability to travel but it has bility to our industry. There is much work with the other associations to ensure by no means restricted our continued to be done moving forward; first and fore- that all of our members are represented. efforts to ensure that everyone’s voice is most, will be the completion of the Con- We will also continue to engage with the heard in this industry. If you require the tractor Sustainability Review. It was still federal government on issues such as re- ILA staff or Board of Directors to assist the goal of all those involved to have this tirement bridging, training dollars for you with anything, please do not hesi- finished well before Christmas so that all of new workers and additional resources tate to contact us either by phone or e- our members can go into 2021 with some for COVID-19 relief. mail, we look forward to talking to you. certainty around their businesses. The pandemic has changed the way Stay safe!! The Old Growth Strategic Review, things are done across the province and Interior Forest Sector Renewal initia- across organizations, which caused the Todd Chamberlain, RFT, General Manager, ILA tive and Woodland Caribou Recovery ILA to hold its annual general meet- Tel: 250-503-2199 Strategy are just a few of the many is- ing using video conferencing technol- Email: todd@interiorlogging.org sues that will require further efforts by ogy and social distancing rules. It was all parties involved to ensure that the held later this year due to the cancella- working forests of British Columbia are tion of our annual convention and trade maintained. I believe it is important that show in May 2020. At this time, we are all of these issues are not considered sin- pleased to announce our new Chairman gularly when making decisions and that Ron Volansky of R&A Logging Ltd. in all of the stakeholders are given an equal Nakusp and our new First Vice Chair- voice prior to decisions being made. De- man Tim Menning of Hytest Timber cisions on the land base affect us all and Ltd. in Williams Lake. I would like to everyone should be afforded the oppor- thank Randy Spence for his dedication 10 Truck LoggerBC Winter 2021
MNP GETTING TO KNOW CHRIS DUNCAN I am approachable. I’m going to show up to your job site with work boots and blue jeans, not a suit and tie. ~ Chris Duncan, MNP We all want to do business with people of the forestry niche at the time and the how to maximize profits. The second most we know, like and trust. That’s why we second he found out that I knew about common question I get is “how do I pay want you to get to know Chris, MNP’s forestry, he pulled me into his team and less tax?” I started to learn more about our work. It What is the biggest concern you National Leader, Forestry and Forest was a good fit then and has remained so. Products Services, who’s passionate have for contractors in your area? about helping forestry businesses How would you characterize your My biggest concern is their exit planning succeed. Learn how Chris approaches professional self? and retirement. Many contractors think his work, and how leading MNP’s I am approachable. I’m going to show up they have a succession plan in place, forestry practice is a story of family to your job site with work boots and blue but what are they doing now to attract work coming full circle. jeans, not a suit and tie. If you have an the talent required to operate and build issue and you call me, I’ll work to explain the next generation of contractors? A Chris, did you always want to the solution in plain English. I work hard to succession plan isn’t typically drafted in become an accountant? ensure clients feel comfortable discussing one night. Depending on where you are at Getting into accounting was a progression their business with me because that will and how you plan to exit or transition the from learning what I didn’t want to do. I lead to the best results. business, it can take years to work through started off in engineering in university and What is your role with MNP? the process. That’s why it’s important to realized I didn’t want to be an engineer start the conversation early. after two years. I learned that accountants My role is to be the quarterback for my clients and help them be more successful. What do you like to do when you’re deal with dollars and cents all day; it’s They’re expecting me to help them in the not at work? nice and simple compared to calculating the load on a bolt on a bridge. I was also day-to-day operation of their business. I’m an outdoors guy. When you’re behind a welder part time and knew that wasn’t From filing their tax return to running their a desk in an office as much as I am, you how I wanted to spend my life. My mind is business more efficiently, my role is to want to get outside. I like to garden a bit set up for the financial work. create solutions to their challenges. I’m a and love fishing, hunting, canoeing, hiking, team member on the client’s team. If they camping. It’s a blessing to get out and What’s your forestry background? have a business question, the first call they breathe that fresh air. I grew up in a forestry family. My dad was make is to me. Finish this sentence: If I bought a a forestry contractor on Vancouver Island. What is the biggest concern you new motorcycle, it would be… There were times that I would take a day hear from contractors? Dual sport Kawasaki KLR 650. I’d hop on it off in high school, work with him and see how hard the work is. I hear questions on profitability all the and drive it straight to South America. time. Am I making any money for all of When I started articling as an accounting this effort? Contractors want to know student, my first supervisor was the leader Contact Chris Duncan CPA, CA National Leader, Forestry and Forest Products Services | 250.856.2443 | chris.duncan@mnp.ca Advertising Feature
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Rick Brouwer North West PERSPECTIVE Ready for Opportunities in 2021 I t’s a new year with a newly re-elected government. Congratulations to our elected representatives in northwest BC: Tenure reform We continue to inform people that northwest BC is an organic example of both members and non-members, the truck wash helps with equipment main- tenance, improved safety and reducing Jennifer Rice (North Coast), Ellis Ross tenure reform; most of the tenures here the spread of invasive plants. (Skeena) and Nathan Cullen (Stikine), and have transitioned to community or First to everyone who ran for office. Congratula- Nations ownership. We have good exam- Log exports tions also to Katrine Conroy, the new Min- ples of tenure holders working together We have continued to explain to deci- ister of Forests, Lands, Natural Resources and with government agencies. sion makers that exports are not bad, as Operations, and Rural Development. We they allow for the continuation of domes- look forward to a good working relation- Contractor Sustainability Review tic operations and sawmills. ship with all our elected representatives, Together with the Truck Loggers Association regardless of their political affiliations, and and Interior Logging Association, we have Advocacy and messaging with the new provincial cabinet ministers. continued to engage, monitor and advocate We met with candidates in the provincial Since we’re looking to the future, it’s al- for the implementation of the recommenda- election, and in every instance we felt that ways good to know what’s been done in tions of the Contractor Sustainability Review. our message was received—that forestry the past, so let’s review what the North and logging are good for the region and West Loggers’ Association has been work- Old Growth Strategic Review provide for community stability. We also ing on for its members and the communi- We provided feedback to the Province's meet with, and act as a resource for, local, ties of the northwest over the past year. old-growth panel and strongly reminded elected representatives. The NWLA has a them that old growth is not in short sup- good relationship with local tenure holders Cost drivers ply in northwest BC, and that we encour- as well, and encourage a broad, holistic ap- Around this time last year, government age proper land use and forestry planning proach to our forest economy; a sustainable reached a new awareness that contractor sus- so that we will always have old growth harvest of the forest profile will result in a tainability issues and operating costs for con- and functioning ecosystems. sustainable contractor force, as well as pros- tractors and forest tenure holders were reach- perous, resilient and stable communities. ing a breaking point. Therefore, government First Nations Going forward in 2021, the NWLA started a cost driver process, engaging with We have seen increased First Nations plans to continue to push forward on the contractors and tenure holders to identify membership and continue to encourage issues that have not yet been fully resolved. significant savings (on the order of $30/m3). First Nations involvement with contrac- In addition, we will cooperate with govern- We provided many ideas for cost reductions tors and economic development. For ex- ments, tenure holders and communities on through improved permitting and consulta- ample, we were excited to see a fibre sup- how to deal with the new normal that is tion processes and timeframes, changes to ply agreement signed between two local resulting from the pandemic, and provide policies, and encouragement and incentives First Nation tenure holders and Skeena input on how to stimulate, incent, and en- for better utilization. The pandemic slowed Sawmills in Terrace, which improved sta- courage community and economic stabili- this initiative down, but the issues have not bility for several of our members. ty and resiliency, regardless of how long the gone away and we are continuing to encour- pandemic is with us. In particular, we will age the reinvigoration of this process. Economic stability through wood- be working on having the cost driver pro- based renewable energy cess reinvigorated and expanded to include Stumpage We have met with multiple parties to ex- considerations related to stumpage; the Stumpage could be considered part of plain the benefits that will come from utiliz- Contractor Sustainability Review recom- the cost driver process, but deserves its ing our fibre-quality wood such as reduced mendations being fully implemented; and own heading. We have not been advocat- carbon release from open burning of woody incenting and encouraging improved and ing for a change to how stumpage is cal- waste, creation of 500 jobs, reduced stress increased use of northwest forest resources culated; instead, we have been encourag- on the social safety net, improved land use through wood-based renewable energy. ing a modification to the way stumpage planning and a stable contractor base. Our message for you in 2021: North West rates are tracked and collected, allowing Loggers, like our forests, are strong and low (negative) stumpage rates to offset Terrace truck wash growing, and we’re ready for opportunities! higher (positive) rates. This will encour- We worked with multiple community- age improved planning, incent better use minded companies to upgrade the truck Rick Brouwer, RPF, NWLA of the resource, and reduce pressure on wash in Terrace. Thanks to everyone that Tel: 250-638-0337 the forests that are closer to sawmills. donated time and materials! Available to Email: rbrouwer@westlandresources.ca Winter 2021 Truck LoggerBC 13
Paul Schuetz Northern Interior PERSPECTIVE Old-Growth Management in the Interior I n September 2020, the provincial government released its commis- sioned report, “A New Future for Old those containing giant cedar and hem- lock trees as found in the Ancient Forest Recreational site east of Prince the existing timber harvesting land base, then that area must be replaced so as not to undermine a licensee’s ability to Forests” that provided an in-depth re- George; to decadent sub-alpine fir achieve its apportionment. view of old-growth management in BC. stands that would have likely burned The report goes on to discuss other Authored by two professional foresters, by now if it wasn’t for BC’s effective strategies for protecting old growth. Al Gorley and Garry Merkel, the report wildfire suppression. The two sites They mention mimicking natural dis- does a good job in defining what old- differ greatly in ecological significance turbance types in certain zones, meet- growth forests are—despite the plethora and only the cedar/hemlock stand ing seral stage distribution targets, and of definitions being used—and their im- might warrant preservation. applying alternative silviculture systems portance to environment and industry, Currently, the system of Old Growth to help maintain the integrity of ancient while also focusing on the problems with Management Areas (OGMAs) in BC was sites. These strategies require a great current old-growth management practices. formulated to “maintain intact old for- deal more planning, and on-the-ground The report offered what seemed like reason- ests,” but Gorley and Merkel are quick to verification; however, Gorley and Merkel able, science-based recommendations to acknowledge that OGMAs “are applied go on to acknowledge that the Province help move the discussion toward an agree- inconsistently and sometimes ineffec- will need to “ensure that the stump- able solution to the issue of old-growth sus- tively.” Rules regarding OGMAs in BC age system provides appropriate offsets tainability in BC, without ever mentioning are also unclear, as many of these areas to cover extra costs.” At the end of the the economics of what they were proposing. contain old trees, while others do not. day, logging contractors in the Interior could support old-growth retention as The assumption that old trees only grow on sensitive, long as the report is not the catalyst to ecologically valuable sites is widely misunderstood, widespread erosion of the timber harvest land base without appropriate balancing and a province-wide blanket approach of protecting of economic and social interest and the old-growth stands based solely on their age is a strat- economic viability of the industry that supports their families. egy that ignores all of the other site characteristics. Upon release of the review, numerous media outlets in the BC Interior and the Gorley and Merkel’s report identifies Environmental groups have complained rest of Canada went on to acknowledge the issues in assuming that old-growth that licensees are logging OGMAs, while that the document was a good first step. management should only revolve around in other cases OGMAs are maintained However, most could not help but include the preservation of old trees. “Not all old as “no-harvest” zones even if they have pictures of harvested trees, clear cuts and forest is the same, and old does not nec- been devastated by insect, disease or damning, unsubstantiated comments in essarily mean big trees” they explain and fire. In their report, Merkel and Gorley order to create an air of controversy for reference a site’s ecological importance as observe that the confusion in OGMA the purpose of making their article more being one of the most significant factors management stems from unclear prac- popular with their readers and to pro- in old-growth preservation. The assump- tices and strategies because “no review of mote preservation of virtually all forests tion that old trees only grow on sensitive, the OGMA system has taken place since over 140 years old. Merkel and Gorley ecologically valuable sites is widely mis- it was implemented more than 20 years state that, “the confidence and trust of understood, and a province-wide blanket ago.” In other words, does an OGMA the general public is the biggest determi- approach of protecting old-growth stands lose its site characteristics and value if fire nant in how much freedom government based solely on their age is a strategy that or disease kills off the trees? Should the and industry have to manage our forests,” ignores all of the other site characteris- OGMA boundaries be static or dynamic, and when media prints biased articles tics. Old-growth protection should be only containing sites with old trees, or containing anti-forestry sentiments con- based on the ecotype, flora and fauna it sites that could contain old trees? Gor- taining little to no scientific backing or sustains, the cultural importance of the ley and Merkel raise similar questions in economic analysis, then they become a sites, and a multitude of other values that their report and acknowledge that clear bigger part of the problem. are described in detail in the report; and operating procedures should be defined. it should be site specific. They also recognize the need to identify Paul Schuetz, consultant to TLA In the BC Interior, stands with 140+ and maintain the “working forest” so that Tel: 250-564-4115 year-old trees may differ greatly from if an OGMA is relocated to an area within Email: pschuetz@industrialforestry.ca 14 Truck LoggerBC Winter 2021
New name, same great team of Forestry Specialists! Winter 2021 Truck LoggerBC 15
Chris Duncan and Mindy Wight Business MATTERS Working with First Nations W orking with First Nation govern- ments and its businesses can result in a powerful partnership with positive re- to work with. Be prepared for a different form of business than you may be used to. ally run as for-profit entities and have a social purpose component such as employing mem- bers of the First Nation community, so un- sults for all involved. However, the partners’ First Nation perspective derstanding that their key objectives are met goals and objectives are often very different First Nation communities are significant within the business arrangements will build from one another. As such, it’s important holders of land and resources. They have a better foundation for future shared success. that all partners keep this in mind when rights to their lands and are important par- they structure their arrangement and con- ties to consult with on projects that take place Who to talk to? duct their mutual business arrangement. within their traditional territory. In fact, the Business perspective rights of Indigenous peoples are recognized For a First Nation approaching a business How to work together? and affirmed by section 35 of the Constitu- regarding a business deal, they will want Business perspective tion Act. Additionally, BC is the first province to meet with key management and/or the For business owners, the focus should be to put the United Nations’ Declaration on the business owner. Effective two-way commu- on building strong relationships with First Rights of Indigenous Peoples into legislation, nication and mutual respect are key. Nations. The stronger the relationship, the meaning free, prior and informed consent is stronger the business arrangement will be. required. Working together with First Nations First Nation perspective Businesses will want to open lines of com- communities builds stronger, more successful Building a mutually beneficial business munication early on in a project to ensure business ventures and creates more opportu- relationship with the First Nation organiza- success and that they understand the culture nities for all when meaningful consultation tion and leadership is important to ensuring and goals of the Nation they are proposing has taken place. Their businesses are gener- the success of the partnership. First Nation WOOD G LTD. CUTTING EDGE A. OZIN FORESTRY LAW D BULL With over 30 years of forestry law experience, Brian Mulholland and our team at EKB can take care of all your legal needs. LOGGING ROADS SAND & GRAVEL / Timber Harvesting Contracts & Subcontracts QUARRY ROCK / Business Sales & Purchases LAND CLEARING / Disputes - Mediation, MARINE CONSTRUCTION Arbitration, Litigation / Environmental & Regulatory Law GENERAL CONTRACTING / Purchases & Leases of Aircraft & CATS • EXCAVATORS • GRAVEL TRUCKS • LOADERS other Equipment Tel: (250) 287-3232 Brian Mulholland A. WOOD BULLDOZING LTD. 604.661.1095 bmulholland@ekb.com P.O. Box 64 Campbell River, BC V9W 4Z9 Fax: 250-287-8262 • Email: awoodbul@telus.net 16 Truck LoggerBC Winter 2021
communities often have different organiza- Nation community. For many, these past use a corporation alone, as the corpo- tional structures from each other; therefore, arrangements have created economic ben- ration is often taxable. Therefore, care- if you’ve worked with one organization in efits and increased opportunities that are ful planning by both parties up front is the past, be mindful that the next First Na- only available with such partnerships while recommended to identify the preferred tion community may follow different gover- increasing awareness of local culture. Build- structure for the business, as making nance practices and processes in managing ing on past relationships lays a strong foun- changes later can be costly. and conducting its business. It will depend dation of trust for future ventures as well. on the First Nation community’s internal Values and objectives of partnering processes and its governance and corporate First Nation perspective together: structure whether you speak directly to the First Nation governments created un- Business perspective chief and council or approach the manager der the Indian Act have a unique tax sta- For businesses looking to partner with of the lands department or the CEO and tus and tax exemptions available under First Nations, a whole new set of doors board of directors of its economic develop- both the Income Tax Act and Indian Act. are opened that provide access to ventures ment group. Their economic development groups that may never have been possible with- and businesses are often structured as out their involvement. This means an in- The how and why of partnership limited partnerships to benefit from tax crease in return on your investment, and structuring: exemption, as well as for liability protec- opportunities to grow your business and Business perspective tion. Joint ventures are also often used create new jobs. It also allows businesses Businesses may enter agreements to en- for shorter-term projects. Many First (Continued to page 21) joy a better relationship with a local First Nation communities will prefer not to AREAS OF SPECIALIZATION Lubricants Wire Rope MRO & Safety Supply Hose Assembly & Chemicals & Rigging Consumables & Services & Testing FOR LOCATIONS VISIT N O R T H ERNMETALIC.COM Winter 2021 Truck LoggerBC 17
Mark Ordeman Safety REPORT Use three points of contact every time to reduce the risk of injury S mall actions can have big impacts for workers who drive on the job. You would be surprised how many inju- It’s also important to avoid facing out- wards when exiting the cab, or while only loosely gripping one handhold. I recall a from the lower step creates an impact force of only one to one and a half times the driver’s body weight; greatly reducing ries are caused through routine, seeming- worker who was only holding on using the risk of injury. ly harmless actions. Getting in and out of one hand when getting out of his truck, Getting out of your truck when carry- your truck correctly and with awareness when he started to slip he grabbed a han- ing items such as paperwork or a coffee of your surroundings is a perfect example dle to stop the fall and thought he was cup can also result in injuries. Workers of something workers don’t always think okay, but after a couple days, the pain in should always leave all items on the floor about—and should. his shoulder was unbearable; eventually of the truck or trailer and only pick them Jumping from the cab floor or the top he ended up in surgery. up when they’re safely on the ground. step of parked trucks and flat decks is a common cause of injuries—as jump- It’s critical to maintain three-point con- The entire workplace is affected when ing from heights can create an impact tact until you are firmly on the ground: someone is injured: force of five to seven times a driver’s Mitigating the risk is simple. Employ- Healing from a fall is time consum- body weight. That means if a driver ers must instruct new drivers—and re- ing and costly for both employers and weighs 91 kg (200 lbs) the impact force mind experienced drivers—to use three workers. Aside from the obvious lost of jumping from the floor of the cab points of contact every time. This means wages, the longer someone is off work is 680 kg (1500 lbs). Jumping from keeping two hands and one foot—or two the more disengaged they become. Be- heights can seriously impact joints and feet and one hand—on the equipment at ing off work for a long period of time increases the risk of a lower back or all times. Using the correct three points slows physical healing and also has lower limb injury. of contact, and carefully stepping down negative consequences for the worker’s MARINE LIN K TRANSPORTATION Full Service Marine Transportation Specialists • Service To All Makes • Kenwood 2-Way Radios • Protec Answering Service • 24-hour Man Checks • Iridium Satellite Phones • Talkie Tooter Service • Satellite Powder Mag Alarms • Telus Cellular • Alarms Sales & Service • Globalstar Satellite Phones 1-877-977-9207 www.nicomm.com PH: 250-287-9207 Dave.Emery@nicomm.com Creative, cost-effective, and efficient problem solving 1690 Island Highway, Campbell River in Marine Transportation. MEMBER OF 24/7 SERVICES dispatch@marinelink.ca www.marinelink.ca AVAILABLE 18 Truck LoggerBC Winter 2021
mental health. For employers, the costs checked the ground, but workers must Photo courtesy of WorkSafeBC associated with workplace injuries show make the extra effort as barriers to safety are up as increased premiums, time spent often psychological. Drivers are in a hurry, replacing and re-training staff, and they’ve always done it that way, or they don’t overall lower morale. want to appear to be overly cautious. They In 2019, WorkSafeBC had 21 time-loss think, “I’ve been getting out of my truck for claims for forestry truck drivers where years this way, nothing has ever happened.” injuries occurred when entering or exit- Well, let me tell you, I’ve seen it enough times ing their vehicles. Almost 62 per cent of to know your luck is going to run out. these injuries happened when falling or jumping from the vehicle. The major- Mark Ordeman, Consultation and Education ity (57 per cent) resulted in sprains and Services Manager strains, while fractures and concussions WorkSafeBC accounted for another 24 per cent and 10 worksafebc.com/transportation per cent respectively. More than half of the injuries occurred • Always use two hands and during the winter due to cold, wet, and one foot—or two feet and one snow covered surfaces, increasing the hand—when getting in and out risk. The effectiveness of your shoes and of your truck. work boots also changes in winter; in • Don’t carry anything like coffee summer heat, rubber soles are great, but cups or papers. in winter rubber hardens, increasing the • Employers: You’re responsible chances of falling. for reminding both new and ex- perienced drivers to use three Safety is always worth it: points of contact every time It takes some time and effort to employ they enter or exit their vehicle. three points of contact and ensure you’ve C I B C WO O D G U N DY S P EC I A L I Z I N G I N CO N S E RVAT I V E I N V E S T M E N T S Season’s Greetings Mutual Funds | Bonds Blue Chip Stocks | Managed Money Dave Wheeldon, B.Sc.Ed, M.A.Ed Investment Advisor 250 703-5382 dave.wheeldon@cibc.ca CIBC Private Wealth Management consists of services provided by CIBC and certain of its subsidiaries, including CIBC Wood Gundy, a division of CIBC World Markets Inc. “CIBC Private Wealth Management” is a registered trademark of CIBC, used under license. “Wood Gundy” is a registered trademark of CIBC World Markets Inc. If you are currently a CIBC Wood Gundy client, please contact your Investment Advisor. Winter 2021 Truck LoggerBC 19
Russ Taylor Market REPORT US Market Outlook and Supply Dynamics T he global market is driven by three big regions: USA, Europe (as a whole) and China plus two other regions: a 13-year high in 2020 of 1.35 million units. Demand for single-family hous- ing continues to be fuelled by 40-year ditions to sawmills (a total of about 5 bil- lion bf), including 15 green- or brown- field sawmills that have been built or are Russia and Canada. Collectively, they low mortgage rates and a desire for more planned for construction. However, this account for 80 per cent of total global indoor and outdoor living space. Conse- may not be enough new supply; my on- timber and lumber consumption and quently, with a severe under building of going analysis suggests that there will production. And, they dominate imports new homes over the last 10+ years, this probably not be enough domestic timber and exports too. pent-up demand is finally kicking in: a supply and sawmilling capacity in North Global log exports continue to be continued growth in new US housing America to meet increasing demand, and driven by China, where softwood log starts is forecast to at least 2023. high prices (like we have seen in 2018 and imports in 2020 should be about 7 mil- In repair and remodelling (R&R), Home 2020) will be required to attract enough lion m3 higher than 2017’s 38 million m3. Depot improved its business by a whopping incremental supplies. In contrast, BC’s log exports to China $15 billion in the first three quarters of 2020. The trend toward increased softwood should see a total reduction of up to 2 Its same store sales were up 25 per cent in lumber imports from Europe is expected million m3 in 2020 from 2017’s 3.2 mil- 2020 Q2 and Q3 over one year earlier. And to continue, especially with the massive lion m3 as competitively priced spruce Lowe’s increased its same store sales by over salvage program of the spruce bark beetle- log imports from Central Europe flood 30 per cent as compared to its four-year killed timber expected to last for much of the market. quarterly sales average of 5 per cent growth. this decade. Europe’s share of US lumber Global lumber demand has been Do-it-yourself customers took steps to ad- imports will be around 9 per cent in 2020, slowing since a strong gain of 4 per cent just their homes to serve three primary pur- with other countries adding another 4 per was achieved back in 2017. Since then, poses: a home school, a home office, and cent. And one thing is certain: Canada will the consumption growth trend has their primary location for recreation and not be the solution for increasing lumber been slowing in consecutive years to 1 entertainment. This mindset bodes well for supplies to the US—it will have to come per cent in 2018, no growth in 2019, continued R&R sales in 2021. from domestic US supply and imports! and an estimated -1 per cent for 2020. The good news is that there has been a North America supply-side dynamics Outlook strong demand rebound in the second Canadian lumber production contin- While global softwood lumber demand half of 2020 following the second quar- ues to decline, mainly from BC’s reduced will decline slightly in 2020 as compared ter global collapse due to shutdowns output as 40 spruce-pine-fir (SPF) saw- to 2019, it has been very strong since from COVID-19, and the outlook for mills have closed since 2005 due to the the start of the pandemic in 2020-Q2 2021 is very promising. mountain pine beetle. While Canada’s all- and this trend should continue through- time production high was 35 billion bf in out much of the next year, resulting in USA demand-side dynamics 2004, its most recent high was almost 28 a net increase in global consumption of After sluggish or no growth in US billion bf in 2017 and output in 2020 is perhaps 4-5 per cent in 2021. However, wood products consumption since 2017, expected to be close to 2019’s 24 billion bf. Canada will remain supply constrained this year’s pandemic resulted in a surge On the other hand, US output has been and other exporters (especially Central in new residential construction and espe- steadily increasing since 2009’s 24 billion Europe) should see opportunities to re- cially in repair and remodelling. bf, mainly from gains in the US South. As place this volume in the US and in some The long-term or normal level of new compared to its peak in 2005 of over 40 export markets. The US market looks residential housing starts in the US is billion bf, production is expected to in- to be a bright spot for 2021 and beyond about 1.6 million starts. However, starts crease in 2020 for the eleventh consecu- as pent-up demand for new homes and have been below 1.6 million since 2007 tive year to 36 billion bf. R&R continues. Nevertheless, there are and the last 20 years have averaged only Since 2018, in the US South, there have still uncertain times ahead with many 1.25 million and are expected to be at been at least 35 announced capacity ad- uncontrollable factors and wild cards at This Market Report is brought to you by: STAFFORD LAKE BENWEST Logging & Road Contractors LOGGING LTD. LOGGING LTD. Campbell River Tel: 250-287-7932 Email: Bryce@bwlog.ca 20 Truck LoggerBC Winter 2021
facebook.com/wahkash instagram.com/wahkash wahkashcontracting.com play that could disrupt an otherwise bull- ish outlook for 2021 and beyond! Russ Taylor, President, Russ Taylor Global (former President of International WOOD MARKETS Group) Tel: 604-897-5666 Email: russtaylor@russtaylorglobal.com Website: russtaylorglobal.com (Continued from page 17) to build relationships with new commu- PROUD ISLAND LOGGERS nities and help those communities estab- lish new resources and employment for their members. First Nation perspective As mentioned, tax, liability protection, and employment are often the key items that the First Nation community will look for in a new business venture. Another key factor to consider is whether the jointly owned entity may qualify as “Indigenous owned,” meaning over 50 per cent is held by the First Nation community. As an In- digenous-owned organization, the busi- ness may qualify for grants, funding and loans, as well as procurement opportuni- ties from government and other organi- zations. This opens up additional paths of capital, debt and business opportunities that may not otherwise be achieved. Conclusion Overall, more and more businesses are entering into partnerships with local First Nations. These partnerships are prov- ing the value and achievements possible when two parties work toward a common goal. First Nations are fast becoming a partner in many communities leading to increased prosperity for all involved. Chris Duncan, CPA, CA Partner and National Leader, Forestry & Forest Products Services MNP Private Enterprise Group Tel: 250-748-3761 Email: chris.duncan@mnp.ca Mindy Wight, CPA, CA Partner, MNP’s National Indigenous Tax Leader, Prince George Tel: 250-596-8316 Email: mindy.wight@mnp.ca MARINE Winter 2021 Truck LoggerBC 21
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