2017 economic state of the B.C. forest sector - llbc.leg.bc.ca · Ministry of Forests, Lands, Natural Resource Operations and Rural Development 2017 Economic State of the B.C. Forest

Ministry of Forests, Lands, Natural Resource Operations and Rural Development

2017 Economic State of the B.C. Forest Sector

August 2018 Prepared by Alex Barnes

Economic Services Branch

1

https://dir.gov.bc.ca/gtds.cgi?esearch=&updateRequest=&view=detailed&sortBy=name&for=people&attribute=display+name&matchMethod=is&searchString=Alexander+Barnes&objectId=135530


Outline

Overview

Products

Markets

Sector Indicators

Conclusions and Outlook

Appendix (additional slides for all topics)

2


Weekly Prices: Tracks weekly prices relevant to the B.C. forest sector.

Monthly Exports: Export values by major market and product groups, including some quantity information.

Annual Mill Report and Quarterly Mills Status Reports: Summary outlining B.C’.s harvest and timber processing activity during the year and of quarterly openings, closings, and investment.

Log Exports: Summary of permit information (Permit Report on right side).

Economic State of the BC Forest Sector: Year in review for the B.C. forest sector.

3

Ministry Economic Reports

http://www2.gov.bc.ca/gov/content/industry/forestry/competitive-forest-industry/forest-industry-economics/weekly-prices

http://www2.gov.bc.ca/gov/content/industry/forestry/competitive-forest-industry/forest-industry-economics

http://www2.gov.bc.ca/gov/content/industry/forestry/competitive-forest-industry/forest-industry-economics/fibre-mill-information

http://www2.gov.bc.ca/gov/content/industry/forestry/competitive-forest-industry/log-exports

http://www2.gov.bc.ca/gov/content/industry/forestry/competitive-forest-industry/forest-industry-economics


Includes forest management, harvesting, reforestation, wood product manufacturing, and pulp and paper product manufacturing.

Plays a key role in the provincial economy with a significant presence in the Lower Mainland, and as an essential contributor to communities outside the Lower Mainland.

Is export-oriented, depending heavily on global markets and exchange rates, and foreign competition.

Is cyclical, affected by the global forest commodity markets and general performance of the world economy.

4

Overview of B.C. Forest Sector


In sales terms, 2017 was an improvement over 2016, with wood products (+13%) and paper products (+11%) both doing well.

B.C.’s forest sector exports increased in 2017 (+3.3%). Export growth was primarily from pulp products (+25%).

The U.S. market continued to gradually improve, as seen in the U.S. housing market, though B.C. exports to the U.S. declined slightly.

China1 continued as the second largest export market for B.C.’s forest sector. Exports to China increased 13% thanks to strong pulp exports.

Employment increased 2.9% (+1,600) in 2017 according to the System of National Accounts2.

In 2017 B.C. Wildfires burned an area 8 times larger than the average area burned from 2007-2016. The fires cost nearly $570 million to fight, and the negative impact on the forest sector can be seen in lower lumber production.

B.C. Lumber Exporters are estimated3 to have paid CA$333 million in U.S. lumber duties in 2017. Tariffs were imposed in May.

1. All references to China in this report include Hong Kong. 2. According to the Survey of Employment, Payrolls and Hours employment increased slightly (+700), and the Labour Force Survey showed a

decrease (-2,800). See Appendix starting on slide 51 for more information. 3. Ministry estimate based on monthly B.C. lumber export value and the “all others” duty rates (CVD + AD). Note: Numbers may not add properly to totals, or always be the exact same on each slide due to rounding.

5

Overview of 2017


6

Overview Indicator 1 – B.C. forest sector manufacturing sales in 2017 were up 12% from 2016 and exports, excluding logs, were up 3.2% from 2016. During the U.S. Housing boom, 2004 was the peak in forest sector manufacturing sales and non-log exports (CA$18.2 and CA$14.7 billion). The increasing gap between manufacturing sales and exports suggests growth of the domestic market, and the gap is now similar to levels seen from 2003-2005. Additionally, in May 2018 manufacturing sales for 2016 received a second upward revision ($580 million which is in addition to the original $780 million revision). Most of this revision was for wood products.

Data source: Statistics Canada; CANSIM 304-0015, and Canadian International Merchandise Trade Database (CIMTD) or via BC Stats. Note historic data is subject to revisions.

$12.2

$9.2 $10.6 $11.1 $11.0

$12.3 $13.9 $14.3

$15.2

$17.0

$9.8

$7.4 $8.8 $9.4 $9.6

$10.9 $11.6 $12.1

$12.9 $13.4

$0

$2

$4

$6

$8

$10

$12

$14

$16

$18

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

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A$

B.C. Manufactured Forest Product Sales and Exports

Forest Sector Manufacturing Manufactured Forest Exports (excludes logs)

http://www5.statcan.gc.ca/cansim/a26?lang=eng&id=3040015



http://www.statcan.gc.ca/eng/trade/data

http://www.bcstats.gov.bc.ca/StatisticsBySubject/ExportsImports/Data.aspx


7

Overview Indicator 2 – B.C. forest sector direct employment was 57,200 in 2017, up 2.9% from 2016. In 2017 there was an increase in Wood Product employment (2.4%) and in Forestry and Logging with Support Activities (4.6%). Pulp and Paper was down (-0.2%). We report this series since it is part of the National Accounts and is therefore used in our analysis, but the Labour Force Survey (LFS) is often quoted in the media and used by other organizations. For further discussion of employment estimates please see slide 51 in the appendix.

Data source: Statistics Canada System of National Accounts (SNA): CANSIM 281-0024.

59.8 51.9 53.4 52.2 52.8 55.2 55.1 55.0 55.6 57.2

20.7 17.9 18.6 18.9 19.3 19.3 20.1 20.2 20.6 21.6

27.8 23.9 25.5 24.3 25.3 27.0 27.0 27.2 27.8 28.5

11.2 10.1 9.4 9.0 8.1 8.9 7.9 7.5 7.1 7.1 0

10

20

30

40

50

60

70

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

thou

sand

s of p

erso

ns

B.C. Forest Sector Direct Employment

B.C. Forestry Employment Forestry and Logging with Support Activities

Wood Product Manufacturing Pulp and Paper Manufacturing

http://www5.statcan.gc.ca/cansim/a26?lang=eng&retrLang=eng&id=2810024&paSer=&pattern=&stByVal=1&p1=1&p2=37&tabMode=dataTable&csid=


Wood Products, especially Lumber: In 2017, B.C. produced 30.6 million cubic metres of lumber, or 46% of Canada’s total softwood lumber production. B.C. wood product sales were CA$12.2 billion in 2017. Sawmill* sales were CA$7.3 billion, or 60% of total Wood Product Manufacturing sales in B.C.

Pulp and Paper Products, especially Market Pulp: B.C. Paper Manufacturing sales were CA$4.8 billion in 2017. Pulp mills** had sales of CA$2.9 billion, or 59% of total Paper Manufacturing sales in B.C.

Logs: In 2017, 64.3 million cubic metres of logs were harvested. Exports of 6.0 million cubic metres (9.3% of harvest), mostly from coastal areas, were worth CA$807 million.

Wood Products-Pellets: B.C. exported 1.78 million tonnes of wood pellets worth CA$311 million. The UK was the primary destination by weight (73%), followed by Japan (14%), Belgium (7.1%), and South Korea (3.1%).

*Excludes shake and shingle mill sales. Sawmills are a subcategory of Wood Product Manufacturing. **Pulp is a subcategory of the Paper Manufacturing NAICS code. 8

Products Overview


9 Products – Wood Products – Wood Product Manufacturing sales totaled CA$12.2 billion in 2017. Sawmill sales accounted for 60% of Wood Product Manufacturing sales. From 2016 to 2017, Sawmill sales increased 12%, and the three other industry groupings increased a combined 14%.

Data source: Statistics Canada; CANSIM 304-0015. Sawmill sales are primarily lumber, and include chip and sawdust sales. Other wood products include wood pellets, and most other products of wood such as cabinets, bowls, tool handles, fencing, etc.

$3.7 $2.5 $3.2 $3.6 $3.8

$5.0 $5.8 $5.8 $6.5 $7.3 $0.6

$0.4 $0.4 $0.4 $0.5

$0.6 $0.6 $0.6

$0.7 $0.8

$1.3

$1.0 $1.0 $1.0 $1.1

$1.4 $1.5 $1.7

$1.8 $2.2

$1.3

$1.0 $1.0 $1.0 $1.1

$1.2 $1.4 $1.5

$1.8 $1.9

54% 51%

57% 60% 59% 61% 62% 60% 60% 60%

0%

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20%

30%

40%

50%

60%

70%

$0

$2

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2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

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B.C. Wood Product Manufacturing Sales

Sawmills* Shake, Shingle and Wood PreservationVeneer, Plywood, and Engineered Wood Products Other Wood ProductsSawmill % Share of Wood Product Manufacturing





10

Products – Softwood Lumber – Softwood lumber production volume declined 4.5% in 2017. Part of this decline was due to forest fires. The Coast accounted for 11% of B.C. production. Lumber production in the past several years is comparable to the production in 1995-1999 when U.S. housing starts averaged around 1.5 million, yet housing starts are currently only 1.2 million. This is due to expanding offshore markets, and possibly to increased domestic value added manufacturing.

Data source: Statistics Canada; CANSIM 303-0064.

3.2 2.4 2.9 3.3 3.8 3.6 3.7 3.7 3.8 3.3

25.0 20.6

24.2 25.9 25.2 26.5 26.2 27.5 28.2 27.3

0

5

10

15

20

25

30

35

2008 2009 2010 2011 2012* 2013 2014 2015 2016 2017

mill

ion

m³

B.C. Softwood Lumber Production

BC Coast BC Interior

*Interior and Coast totals are Estimates. In all years the Interior includes production from Yukon, Northwest Territories, and Nunavut, though the volume is negligible





11

Products – Softwood Lumber – In 2017, 82.2% of softwood lumber production volume was spruce, pine or fir (SPF), and 17.8% was from other species such as cedar, Douglas fir, and hemlock. For comparison, in terms of export volume SPF was 74% of the total, while other species made up 26%. This demonstrates SPF is important to the domestic market (5.3 million m3, 17% of production).

Data source: Statistics Canada; CANSIM 303-0064 and B.C. Stats extract from Statistics Canada data. Also available from Statistics Canada CIMTD. Based on volume in cubic metres. Note historic data is subject to revisions.

Spruce-Pine-Fir

82%

Other Softwoods

18%

B.C. Softwood Lumber Production (30.6 million m3), 2017

Spruce-Pine-Fir

74%

Western Red Cedar

6%

Douglas Fir 7%

Hem-Fir 5%

Other 8%

B.C. Softwood Lumber Export Volume (25.3 million m3), 2017

B.C. Softwood Lumber Production and Export Value Share by Species, 2017







12

Products – Softwood Lumber – In 2017 Canada consumed approximately 25 million m3 of lumber, which included 5.3 million m3 of B.C. lumber. This volume was used domestically as lumber (such as in housing) or was turned into a value added wood product (siding, engineered wood products) which was used domestically or exported. The increase in consumption since 2014 indicates growing demand for lumber, and possibly the expansion of of the value added sector. In 2017 an additional 1 million m3 of B.C. lumber production was consumed in Canada.

Data source: B.C. Stats extract from Statistics Canada data. Also available from Statistics Canada CIMTD and CANSIM 303-0064. Note historic data is subject to revisions.

0

5

10

15

20

25

30

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

m3

mill

ions

Estimated Canadian Consumption of Lumber

Total Consumption Consumption of B.C. Lumber








13

Products – Pulp and Paper – Total Paper Manufacturing sales (includes pulp) were CA$4.8 billion in 2017, increasing by 11%. Pulp Mill sales increased 17% from 2016 to 2017, and accounted for 60% of total sales. Paper and Paperboard sales were up 1.4%, and Converted Paper was up 13%.

Data source: Statistics Canada; CANSIM 304-0015. Converted paper includes products created from purchased paper and paperboard.

$2.2 $1.9 $1.7 $1.8 $1.7 $1.5 $1.6 $1.7 $1.5 $1.5

$2.8

$2.2 $2.9 $2.9

$2.5 $2.3 $2.7 $2.6

$2.4 $2.9

$0.4

$0.3

$0.3 $0.3

$0.3 $0.3

$0.3 $0.3 $0.4

$0.4

51.8%

49.2%

59.1% 58.2% 56.0% 56.2% 58.2% 56.5% 56.5% 59.5%

0%

10%

20%

30%

40%

50%

60%

70%

$0

$1

$2

$3

$4

$5

$6

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

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B.C. Paper Manufacturing Sales

Paper and Paperboard Pulp Mills Converted Paper Pulp % Share of Paper Manufacturing





14

Products – Pulp – Bleached sulphate (kraft) pulp dominates B.C.’s pulp exports.

Data source: Statistics Canada via BC Stats; CIMTD. Based on air dry tonnes. NES stands for “not elsewhere specified”. Note historic data is subject to revisions.

78.3%

12.2%

4.5% 4.3% 0.7%

2017 B.C. Pulp Export Share by Product (4.3 million tonnes)

Chemical wood pulp, soda or sulphate, coniferous,bleached, nes

Wood pulp obtained by a combination of mechanical& chemical pulping processes

Chemical wood pulp, soda or sulphate, coniferous,unbleached

Chemical wood pulp, soda or sulphate, semi-bleached/bleached, non-coniferous

Other Pulp


15 Products – Logs – Total harvest volume (64.3 million m³) was down 2.9% from 2016, and up 32% from 2009. The Interior accounted for 74% of the harvest, and the Coast for 26%. The last few years of interior harvest are close to pre-beetle harvest uplift, pre-housing boom levels.

Data source: B.C. Ministry of Forests, Lands, Natural Resource Operations and Rural Development (FLNR) Harvest Billing System. All logs, special forest products, species and grades billed excluding waste, reject and Christmas trees, data run on June 1, 2018. Includes both Crown and private lands.

45.7 37.7

46.8 50.2 49.6 50.8 47.1 50.9 47.8 47.7

15.4

11.2

16.5 19.4 18.4 20.3

19.3 17.8 18.3 16.6

61.1

48.8

63.3 69.6 68.0 71.0

66.4 68.7

66.2 64.3

0

10

20

30

40

50

60

70

80

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

mill

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m³

B.C. Timber Harvest Volume

Interior Coast

https://a100.gov.bc.ca/pub/hbs/home.jsp


16 Products – Logs – Hemlock and Douglas fir make up roughly 2/3 of the harvest on the Coast. In the Interior the main species is lodgepole pine, followed closely by spruce in 2017. Lodgepole pine as a share of Interior harvest fell roughly 10 percentage points compared to 2016, with spruce filling most of the gap. During the height of salvage response to the mountain pine beetle epidemic, lodgepole’s share was in the 60’s.

Data source: B.C. Ministry of Forests, Lands, Natural Resource Operations and Rural Development (FLNR) Harvest Billing System. All logs, special forest products, species and grades billed excluding waste, reject and Christmas trees, data run on June 1, 2018. Includes both Crown and Private lands.

Hemlock 34.5%

Douglas Fir 31.4%

Red Cedar 18.2%

Balsam 9.4%

Other 6.5%

Species Mix for 2017 B.C. Coast Harvest

(16.6 mil. m3)

Lodgepole Pine

32.9%

Spruce 32.5%

Douglas Fir 11.8%

Balsam 12.8%

Other 10.0%

Species Mix for 2017 B.C. Interior Harvest

(47.7 mil. m3)

https://a100.gov.bc.ca/pub/hbs/home.jsp


The U.S., China, and Japan are the top three export markets for the B.C. forest sector.

The U.S. is the largest market and has improved substantially since 2009. It still has significantly less share of B.C. forest exports compared to pre-2009. Value of exports to the U.S. declined in 2017 (-$212 million) due primarily to lower lumber export volume.

China has increased substantially over the last decade and is now in a strong second place. China’s share increased to around 27% of B.C. forest product exports in 2017 compared to 25% in 2016.

Japan has decreased compared to the late 1990s, but value has been steady lately. In terms of share, Japan remains in third place since 2009. Value was up $77 million in 2017.

Other export markets made up 15% of total forest sector exports in 2017, with notable destinations being South Korea (2.8%), the U.K. (2.2%), Indonesia (1.9%), and Taiwan (1.2%).

The domestic market is also important to the forest sector. The potential size of the market is suggested by the difference between manufacturing sales and exports on slide 6.

17

Markets Overview


18

Markets – The U.S. was the #1 export market by value, and was increasing steadily until 2017. China became the #2 market in 2009 and has been a key driver of the forest sector’s recovery since then. Japan was #2 for many years, until 2009, and is now #3.

Data source: B.C. Stats extract from Statistics Canada data. Also available from Statistics Canada CIMTD. Note historic data is subject to revisions

$5.6

$4.0 $4.1 $3.8 $4.3 $5.0

$5.5 $6.1

$7.1 $6.9

$1.2 $1.3 $2.2

$3.3 $3.1 $3.7

$3.8 $3.7 $3.4 $3.8

$1.3

$2.1

$10.1

$7.6

$9.1 $10.0 $10.2

$11.7 $12.4 $12.8

$13.7 $14.2

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$16

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

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B.C. Forest Product Exports by Market

U.S. China + Hong Kong Japan Other Total




19

Markets – U.S. – The U.S. was B.C.’s largest market in 2017 at CA$6.9 billion, a decrease of 3% over 2016. The U.S.’s share of B.C.’s forest product exports decreased to 48.9%. The top 5 Other Wood Products were OSB, Veneer and Plywood (Douglas fir), Shakes, Shingles, and Siding.

Data source: B.C. Stats extract from Statistics Canada data. Also available from Statistics Canada CIMTD. Note historic data is subject to revisions.

$2.2 $1.5 $1.8 $1.6 $2.0 $2.6 $3.0 $3.3 $4.3 $4.2

$0.8 $0.5 $0.7 $0.6 $0.5

$0.4 $0.4 $0.4

$0.4 $0.3 $1.2

$0.9 $0.8 $0.9 $1.0

$1.2 $1.2

$1.6 $1.8 $1.8

$1.3

$1.0 $0.8 $0.8 $0.8

$0.8 $0.8

$0.8

$0.6 $0.6

55.5% 52.8%

45.1%

38.3% 42.8% 42.7% 44.7%

48.0% 52.1% 48.9%

0%

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2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

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B.C. Forest Product Exports to the United States

Logs Lumber Pulp Other Wood Products Other Paper Products % Share of B.C. Forest Product Exports




20

Markets – China – B.C. forest product exports to China as a share of total B.C. forest exports increased to 27% of B.C.’s forest exports. The value in 2017 was CA$3.8 billion, an increase of 13% from 2016. Pulp is the dominant export product (55%).


$0.3 $0.4 $0.4 $0.3 $0.4 $0.5 $0.2 $0.3 $0.7

$1.1 $1.1 $1.4 $1.4

$1.1 $1.0 $1.1 $0.9 $0.8

$1.3

$1.7 $1.6 $1.7 $1.9

$2.1 $1.8 $2.1

11.8%

16.5%

24.1%

32.6% 30.6% 31.4% 30.5%

28.8%

24.9% 27.2%

0%

5%

10%

15%

20%

25%

30%

35%

40%

$0.0

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2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

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B.C. Forest Product Exports to China





21

Markets – Japan – B.C.’s exports to Japan have decreased about 75% from peak years in the mid-1990s, but exports have been relatively steady in recent years. Exports were valued at CA$1.3 billion in 2017, an increase of 6.3% from 2016. Lumber had the highest share of value with 56% in 2017.


$0.1 $0.1 $0.1 $0.1 $0.1 $0.2 $0.2 $0.1 $0.2 $0.2

$0.7 $0.5

$0.6 $0.7 $0.7 $0.8 $0.8 $0.8 $0.7 $0.7

$0.2

$0.2

$0.2 $0.2 $0.2

$0.2 $0.2

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$0.1

$0.1 $0.2 $0.1

$0.1 $0.1

$0.1 $0.2 $0.1

12.3% 12.3% 12.4%

11.8% 11.2% 11.5%

10.3% 9.3% 9.0%

9.2%

0%

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6%

8%

10%

12%

14%

$0.0

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$1.6

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

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B.C. Forest Product Exports to Japan





22

Markets – Softwood Lumber – Prior to the U.S. housing crash B.C.’s lumber export market was heavily reliant on the U.S. Now other destinations, primarily China, have reduced the share of the U.S., though the U.S. still makes up the majority of B.C.’s lumber export value.


$2.2 $1.5 $1.8 $1.6 $2.0

$2.6 $3.0 $3.3 $4.3 $4.2 $0.2

$0.3 $0.7 $1.1

$1.1

$1.4 $1.4 $1.1

$1.0 $1.1

$0.7 $0.5

$0.6 $0.7 $0.7

$0.8 $0.8 $0.8

$0.7 $0.7

$0.5

$0.3

$0.4 $0.5 $0.4

$0.5 $0.5 $0.6

$0.6 $0.6

$3.6

$2.7

$3.6 $3.8 $4.2

$5.3 $5.7 $5.8

$6.7 $6.6

$0

$1

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2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

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B.C. Softwood Lumber Exports by Market

U.S. China Japan Other




23

Markets – Softwood Lumber – Prior to the U.S. housing crash B.C.’s lumber export market was heavily reliant on the U.S. Now other destinations, primarily China, have reduced the share of the U.S., though the volumes to China have been declining after 2013. The lower volumes in 2017 were offset by higher prices as demonstrated on the previous slide where total value is relatively unchanged.


15.8

11.9 12.3 11.2 12.5

13.6 14.5 15.5 17.9

16.1

1.2 2.6

4.6

7.3 7.5 8.0 7.6 6.7 6.0 5.5

21.2

17.8

20.8 22.8

24.2 25.9 25.8 26.2

27.7 25.3

0

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25

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2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

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B.C. Softwood Lumber Export Volume by Market

U.S. China Japan Other BC Total




24

Markets – Pulp – China had a dominant 61% share of B.C. pulp exports in 2017, followed by the U.S. (10%), Japan (8%), and other destinations (22%).


$0.9 $0.8 $1.3

$1.7 $1.6 $1.7 $1.9 $2.1 $1.8 $2.1

$0.8 $0.5

$0.7

$0.6 $0.5 $0.4 $0.4

$0.4 $0.4

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$0.2 $0.2 $0.2

$0.2 $0.2

$0.3 $0.9

$0.5

$0.7 $0.7

$0.6 $0.6 $0.6

$0.6 $0.7

$0.7 $2.9

$2.1

$2.9 $3.2

$2.9 $2.8 $3.1

$3.3 $3.0

$3.5

$0

$1

$2

$3

$4

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

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B.C. Pulp Export Value by Market

China U.S. Japan Other




25

Markets – Pulp – China had a dominant share of B.C. pulp exports in 2017. Over the past decade exports to China have more than doubled.


1.3 1.4 1.7

2.2

2.7 2.7 2.6 2.8

2.6 2.7

1.3 0.9 0.9 0.9

0.9 0.8 0.8 0.8 0.9 0.9

4.0

3.3

3.8 4.1

4.4 4.2 4.1 4.3

4.1 4.3

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2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

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B.C. Pulp Export Tonnage by Market

China U.S. Japan Other BC Total




26

Markets – Logs – The value of log exports increased by 4.7% in 2017. China (59%) remained the largest destination. Japan (25% share) and the U.S. (5%) decreased. South Korea (13% share) increased in 2017 over 2016. Over the past decade China replaced Japan as the main log export market.


$77 $38 $35 $36 $53 $54 $56 $65 $48 $44 $21 $38

$121

$313 $284 $431 $415 $335 $429 $476

$140 $121

$134

$109 $147

$195 $194

$140

$191 $177

$35 $48

$80

$127 $89

$114 $114

$120

$98 $105

$278 $249

$373

$588 $577

$802 $784

$665

$771 $807

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2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

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ion

CA$

B.C. Log Exports by Market

U.S. China Japan South Korea Other




27

Markets – Logs – The volume of log exports decreased in 2017. Volume to China (59% share) declined slightly. South Korea (11% share), the U.S. (6%), Japan (21%) decreased in 2017 over 2016. Over the past decade China replaced Japan as the main log export market.


0.2 0.4 1.2

2.9 2.9

3.6 3.4 2.9

3.7 3.7

1.2 1.1 1.3

1.0 1.3 1.6 1.5

1.1 1.4 1.3

2.6 2.5

3.7

5.4 5.7

6.7 6.3

5.6

6.3 6.0

0

1

2

3

4

5

6

7

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

mill

ion

m3

B.C. Log Export Volume by Market

U.S. China Japan South Korea Other BC Total




Prices and Costs: 2017 was a good year for a vast array of wood products. Lumber, wood panels, pulp, and paper all had price increases. B.C. Interior sawmilling costs increased slightly in 2016, but this was more than offset by higher lumber prices.

U.S. Housing Market: U.S. housing starts were 1.2 million in 2017, the seventh year of gains since the 0.55 million start low in 2009. The share of multi-family starts is high (29%, down from 2015’s recent high of 36%), which reduces wood consumption compared to similar levels of starts in the past.

B.C.’s Share of Canadian Forest Export Value: B.C.’s share increased slightly from 2016 to 2017, now accounting for 38% of Canadian forest product export value.

Government Revenues: Direct forestry revenues to government increased 5.7% in fiscal year 2016/17 ($913 million) compared to 2015/16 ($865 million) according to the 2018 B.C. budget and fiscal plan. Ministry accounts indicate revenue of $1,065 million in 2017/18.

28

Overview of Sector Indicators


29

Prices and Costs – North American housing markets improved in 2017, but housing starts were still low compared to the early/mid 2000’s. Average SPF 2x4 lumber prices rose significantly in 2017.

Data sources: Madison's Lumber Reporter (SPF), U.S. Census Bureau, JAWIC and Statistics Canada.

900

554

587

609

781

925

1,0

03

1,1

12

1,1

74

1,2

03

212

149

190

194

215

188

189

196

198

220

517

430

460

465

487

550

489

504

546

545

$219 $181

$255 $254 $299

$358 $353

$281 $308

$411

$234 $207

$258 $251 $299

$369 $390 $359

$408

$533

0

500

1,000

1,500

2,000

2,500

3,000

$0

$100

$200

$300

$400

$500

$600

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Hous

ing

star

ts in

000

uni

ts

Pric

e in

$ p

er 0

00 b

d ft

SPF 2x4 Lumber Prices and Housing Starts

US Housing Starts Canada Housing Starts Japan Wood Housing StartsSPF 2x4 Lumber Prices (US$) SPF 2x4 Lumber Prices (C$)

http://www.madisonsreport.com/

http://www.census.gov/construction/nrc/index.html

http://www.jawic.or.jp/english/index.php

http://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/manuf05-eng.htm


30

Prices and Costs – The share of multi-family starts has declined for two years in a row now. Multi-family units use roughly 66-75% of the wood that a single family unit does.

Data sources: U.S. Census Bureau.

622 445 471 431 535 618 648 715 782 849

278

109 116 178 245

307 356 397

392 354

31%

20% 20%

29% 31%

33% 35% 36%

33%

29%

0%

5%

10%

15%

20%

25%

30%

35%

40%

0

200

400

600

800

1,000

1,200

1,400

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Mul

ti-Fa

mily

Sha

re o

f St

arts

U.S

. Hou

sing

Sta

rts

U.S. Housing Starts: Single vs. Multi-Family Units

U.S. Single-Family Starts U.S. Multi-Family Starts Multi-Family Share

http://www.census.gov/construction/nrc/index.html


31

Prices and Costs – In 2017, B.C. Interior softwood lumber mills had variable costs slightly above the U.S. South. The U.S. South was the lowest cost producer.

Data source: Costs are from Forest Economic Advisors (FEA), composite from Random Lengths, and SPF 2x4 from Madison’s Lumber Reporter.

$0

$100

$200

$300

$400

$500

U.S. South B.C. Interior U.S. West Inland Ontario U.S. West Coast Quebec

US$

/000

bd

ft

Softwood Lumber Mills' Variable Costs (2017)

Net Delivered Wood* Labour Energy Miscellaneous* = Delivered Wood - Residual Income

Average RL Lumber Composite Price: US$413/000 bd ft

Average Western SPF 2x4 #2&Btr Price: US$411/000 bd ft

https://www.getfea.com/

http://www.randomlengths.com/

http://www.madisonsreport.com/


32

Prices and Costs – Pulp prices increased in 2017. Pulp output declined in 2016 (-8.6%). The latest production data available from the B.C. Mill survey is for 2016.

Data source: Prices from Equity Research Associates (ERA). Pulp output from Major Primary Timber Processing Facilities report.

$840

$665

$937 $955

$813 $864 $928

$849 $803 $898

$896

$759

$945 $944

$812 $889

$1,024 $1,083 $1,064

$1,165

0

1

2

3

4

5

6

7

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Pulp

Out

put,

mill

ion

tonn

es

$/to

nne

Market Pulp Prices and Pulp Output

B.C. Pulp Output NBSK Prices (delivered Europe, US$) NBSK Prices (delivered Europe, CA$)

http://era-research.com/

https://www2.gov.bc.ca/gov/content/industry/forestry/competitive-forest-industry/forest-industry-economics/fibre-mill-information


33

Data source: 2000-2006, OANDA. 2007-2016, Bank of Canada.

Prices and Costs – This shows the percent change in CA$ exchange rates compared to 2000. Increases indicate appreciation of the CA$ and make Canadian exports less competitive. By the end of 2017 the CA$ appreciated against the US$ and Yen and Yuan.

80.00

90.00

100.00

110.00

120.00

130.00

140.00

150.00

160.00

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Exch

ange

Rat

e In

dex

(200

0 =1

00)

Indexed Foreign Exchange Rates Relative to CA$

US$/CA$ Yuan/CA$ Yen/CA$

2000 Exchange Rates 0.67 US$/CA$ 5.58 Yuan/CA$ 72.62 Yen/CA$

2017 Exchange Rates 0.77 US$/CA$

5.21 Yuan/CA$ 86.36 Yen/CA$

http://www.oanda.com/

http://www.bankofcanada.ca/rates/exchange/


34

Data source: U.S. Department of the Treasury.

Prices and Costs – The cost of short-term and long-term borrowing increased in 2017. This is the first time they’ve both increased since 2006.

6.1%

3.5%

2.0%

1.2%

1.9%

3.6%

4.9% 4.5%

1.8%

0.5% 0.3% 0.2% 0.2% 0.1% 0.1% 0.2%

0.6% 1.2%

6.2% 5.6% 5.4%

5.0% 5.0% 4.6%

5.0% 4.9% 4.4% 4.1% 4.0%

3.6%

2.5% 3.1% 3.1%

2.6% 2.2%

2.7%

0%

1%

2%

3%

4%

5%

6%

7%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Yiel

d in

per

cent

U.S. Treasury Bill Yields

1 Year Treasury 20 Year Treasury

https://www.treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yield


35

Investment – B.C. forest sector investment (CA$1,517 million) decreased 20% from 2015 to 2016. Expenditure includes investment in construction (e.g. buildings and land improvements) and in machinery and equipment. 2016 is the latest year for repair expenditure.


$2,258

$1,613 $1,632

$1,029 $1,241 $1,218

$799

$1,217

$1,811 $1,890

$1,517

$0

$500

$1,000

$1,500

$2,000

$2,500

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017* 2018*

mill

ion

CA$

B.C. Forest Sector Capital and Repair Expenditures

Capital Expenditure Repair Expenditure Total Forestry ExpenditureData quality grade is often "Use with caution". *Preliminary and intentions, subject to change.

http://www5.statcan.gc.ca/cansim/a26?lang=eng&retrLang=eng&id=0290045&paSer=&pattern=&stByVal=1&p1=1&p2=-1&tabMode=dataTable&csid=




36

Investment – From 2015 to 2016 capital expenditure decreased 39%, 2017 preliminary results indicate a 39% increase from 2016 to 2017. Historic preliminary data has been included to demonstrate the difference that can occur when moving from preliminaries to actuals. Capital expenditure includes investment in construction (e.g. buildings and land improvements) and in machinery and equipment.

Data source: Statistics Canada; CANSIM 029-0045. *Preliminary and intentions, subject to change. Data quality grade is often "Use with caution".

$119 $85 $89 $36 $67 $91 $101 $144 $212 $198 $220 $208 $205

$533

$254 $289 $148

$204 $32 $44

$290

$518 $580

$234 $275 $418

$282

$210 $191

$57

$172

$181 $103

$84

$186 $171

$124 $318

$235

$934

$550 $569

$240

$442

$304 $248

$517

$916 $949 $1,001

$577 $668

$801 $858

$0

$200

$400

$600

$800

$1,000

$1,200

Capi

tal E

xpen

ditu

re

Capi

tal E

xpen

ditu

re

Capi

tal E

xpen

ditu

re

Capi

tal E

xpen

ditu

re

Capi

tal E

xpen

ditu

re

Capi

tal E

xpen

ditu

re

Capi

tal E

xpen

ditu

re

Capi

tal E

xpen

ditu

re

Capi

tal E

xpen

ditu

re

Capi

tal E

xpen

ditu

re

His

toric

Pre

limin

ary

Capi

tal E

xpen

ditu

re

His

toric

Pre

limin

ary

Prel

imin

ary

Inte

ntio

ns

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017* 2018*

mill

ion

CA$

B.C. Forest Sector Capital Expenditure

Pulp and Paper

Wood Products

Forestry and Logging





37

Investment – 2016’s results indicate B.C. forest sector repair expenditures were relatively unchanged from 2015. Repair expenditure includes investment in construction (e.g. buildings and land improvements) and in machinery and equipment. 2016 is the latest data for repair expenditure.


$636 $533 $478 $338

$235 $408

$97 $267 $279 $355 $443

$577

$417 $480

$331 $391

$419

$305 $195

$315 $412

$355

$112

$113 $105

$119 $174

$87

$148 $238

$302 $174 $141

$1,324

$1,063 $1,063

$788 $799

$914

$551

$700

$895 $941 $940

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

mill

ion

CA$

B.C. Forest Sector Repair Expenditure

Wood Products Pulp and Paper Forestry and LoggingData quality grade is often "Use with caution".





38

Government Revenues – The current version of the Budget and Fiscal plan shows forest revenue of CA$912 million in 2016/17. Current 2017/18 actual revenue is $1,065 million, which is higher than the updated forecast shown above ($992 million). Note this chart is different than in previous years; it now matches information found in the B.C. Budget and Fiscal Plan. The softwood lumber border tax ended in 2016/17.

Data source: B.C. FLNR. Corporate and personal income taxes are not included in these figures. These numbers are consistent with the B.C. Ministry of Finance Budget and Fiscal Plan, Table A5, page 133. Forecasts are from the 2018/19 to 2020/21 Budget and Fiscal Plan dated February 20, 2018.

$436 $482 $562

$719 $754 $865

$913 $992 $992 $954 $929

$0

$200

$400

$600

$800

$1,000

$1,200

10/11 11/12 12/13 13/14 14/15 15/16 16/17 2017/18 2018/19 2019/20 2020/21

CA$

mill

ions

B.C. Government Forest Sector Revenue, by Fiscal Year

Total Revenue Timber Sales* BCTS Softwood Lumber Border Tax Other Forestry Revenue**

*Timber Sales excludes BCTS sales. **Includes Other CRF Revenue, Forest Recoveries, and Logging Tax. Dashed lines denote forecasts.

http://bcbudget.gov.bc.ca/2018/bfp/2018_Budget_and_Fiscal_Plan.pdf

http://bcbudget.gov.bc.ca/2018/bfp/2018_Budget_and_Fiscal_Plan.pdf


39

Government Revenues – In 2017, Interior average stumpage increased CA$2.9/m3 (23%) and Coast average stumpage increased CA$1.8/m3 (16%).

Data source: FLNR HBS. Data run on June 1, 2018. Includes BCTS. Excludes waste and reject.

$17.9

$5.5 $4.6 $4.3

$4.2

$6.1

$8.2 $8.5

$12.0

$13.8

$6.2 $4.7

$3.7 $3.5

$5.2

$8.9

$11.6 $11.7 $12.8

$15.7

$0

$2

$4

$6

$8

$10

$12

$14

$16

$18

$20

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Aver

age

Stu

mpa

ge (C

A$/m

3 )

Average Stumpage Rates (CA$/m3)

Coast Average Stumpage Interior Average Stumpage

https://a100.gov.bc.ca/pub/hbs/


Despite some quantity indicators suggesting a slowdown in B.C.’s forest sector (lumber production -1.4 million m3, harvest -2 million m3), and an unprecedented fire season, value indicators demonstrate strong growth (manufacturing sales +$1.9 billion, exports +$1.1 billion). The $800,000 increase of manufacturing over exports suggests a large bump in the Canadian domestic market (which may also indicate additional value added).

Chinese demand for logs, lumber, and especially pulp continued to be a key market for the B.C. forest sector. China’s total lumber imports rose substantially yet again (+6 million m3), mostly from Russia and non-U.S./Canadian. Canada’s lumber export volume to China declined (-0.2 million m3), but this was offset by strong pulp sales.

Compared to pre-recession, B.C.’s forest sector has better diversity in export destinations. China has a major share, and the U.S. and Japan continue as major markets. The B.C. forest sector is trying to further this diversification by promoting sales to India, and expanding into new products such as engineered lumber and wood pellets.

40

Conclusions


Stronger demand (mainly from a recovering U.S. market) and smaller B.C. timber supply are expected to continue to have a positive influence on prices. So far in 2018 lumber prices have been exceptional, hitting record levels. It’s difficult to tell how much has been driven by the U.S. tariffs on lumber (CVD 14.19%, AD 6.04%*) vs. changing consumer demand and supply constraints. Transportation problems have also been contributing to higher prices.

China continued as the world’s largest importer of logs and lumber in 2017, with large increases in log and lumber imports. This demonstrates China is continuing as a strong market, but Russia’s continued increase in supply to China may harm B.C. exporters.

Pulp and paper prices have been high recently as well. If this continues it will be good news for the B.C. Industry. However, paper has been a target for U.S. tariffs as well.

*These are the rates for “All others”, which excludes Canfor, Irving, Resolute, Tolko, and West Fraser. Those five companies have their own rates.

41

Outlook

https://www2.gov.bc.ca/gov/content/industry/forestry/competitive-forest-industry/softwood-lumber-trade-with-the-u-s


Foreign demand for wood pellets has been strong. B.C. export tonnage increased roughly 56% making it an extraordinary year to follow; 2017 tonnage decreased roughly 8%. The U.K. is the number one destination. Japan and Belgium also took large volumes in 2017.

Innovations and investments in markets, products and technologies will make the sector more competitive. BC is known for manufacturing high-quality engineered wood products and advancing innovative mass timber building systems, such as UBC’s 18 storey residence, and UNBC’s Wood Innovation Research Lab, representing opportunities that can grow the forest sector and maximize the value of BC’s forest resource.

UBC’s Brock residence used an estimated 2,233 m3 of Cross-Laminated-Timber or Glulam, which is equivalent to the amount of lumber used in 60 single-family houses in Canada*.

There’s also research and innovation occurring for non-traditional uses of wood. Products like wood-cellulose based plastic, 3-d printing, and insulation are just a few examples.

*Source for houses conversion: Forest Economic Advisors

42

Outlook - Continued

http://www.naturallywood.com/sites/default/files/05-31-2016%20UBC_Brock_Commons_FACTSHEET.pdf

http://www.naturallywood.com/sites/default/files/05-31-2016%20UBC_Brock_Commons_FACTSHEET.pdf

https://www.getfea.com/


Appendix

Overview (44-55)

Manufacturing sales, exports, GDP, Employment

Products (56-66)

Markets (67-80)

Economic Multipliers (81)

Additional Sources (82)

43


44

Overview Indicator 1a – B.C. forest sector manufacturing sales (CA$17.0 billion) increased 13% from 2016. The forest sector accounted for 33% of B.C. manufacturing sales. 2016 was revised upward significantly.


$6.8 $4.8 $5.7 $6.1 $6.5

$8.1 $9.3 $9.7 $10.8 $12.2

$5.4

$4.4 $4.9 $5.1 $4.4

$4.2 $4.6 $4.6

$4.3

$4.8 30.9% 28.0%

29.9% 29.3% 28.5% 30.6% 31.7% 31.9% 32.1%

33.1%

0%

10%

20%

30%

40%

$0

$2

$4

$6

$8

$10

$12

$14

$16

$18

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

billi

on C

A$

B.C. Forest Sector Manufacturing Sales

Wood Product Manufacturing Paper Manufacturing Forest Sector Share of Total Manufacturing





45

Overview Indicator 1b – B.C. forest product exports (CA$14.2 billion) increased 3.3% from 2016, and 86% from 2009. The forest sector’s share of total B.C. export value declined roughly 2 percentage points from 2016 to 2017.

Data source: B.C. Stats extract from Statistics Canada data. Does not include products shipped to other regions of Canada. Also available from Statistics Canada CIMTD. Note historic data is subject to revisions.

$5.4 $4.1 $5.1 $5.7 $6.2 $7.7 $8.1 $8.4 $9.8 $9.7

$4.7

$3.5 $4.0 $4.3 $4.0

$3.9 $4.3 $4.4 $3.9 $4.4

30.5% 30.1% 31.9% 30.6% 32.3% 34.9% 34.5% 36.0% 35.3% 32.4%

0%

10%

20%

30%

40%

50%

$0

$2

$4

$6

$8

$10

$12

$14

$16

$18

$20

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

billi

on C

A$

B.C. Forest Sector Exports

Wood Products Pulp & Paper Products Forestry % of BC Commodity Exports




46

Data source: Statistics Canada. Source prior to 2007: CANSIM 381-0015. For 2007 onwards: CANSIM 379-0030. Based on current dollar data with 2014 being the latest available data. Overview Indicator 2a – GDP in current dollars allows comparisons between sectors, industries (subsectors) and the provincial economy as a whole in a given year. It does not adjust for inflation. The decline in forestry’s share over time is largely due to GDP growth of the B.C. economy as a whole (notably the service industry and real estate). Since 2009 the share has been fairly stable.

5.8% 5.1%

4.1%

3.2% 2.7% 2.9% 3.0% 3.1% 3.1% 3.1%

0%

1%

2%

3%

4%

5%

6%

7%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Forest Sector's Share of B.C. GDP, in Current Dollars

Forest Sector Forestry and Logging Support Activities for Forestry

Wood Product Manufacturing Paper Manufacturing

http://www5.statcan.gc.ca/cansim/a05?lang=eng&id=3810015&pattern=3810015&searchTypeByValue=1&p2=35



47

Overview Indicator 2b – GDP in current dollars allows comparisons between sectors, industries (subsectors) and other sectors, such as the Goods Manufacturing sector, in a given year. It does not adjust for inflation. Since 2008 the Forest Sector has made up 12-13% of Goods Manufacturing GDP.

Data source: Statistics Canada. Source prior to 2007: CANSIM 381-0015. For 2007 onwards: CANSIM 379-0030. Based on current dollar data with 2014 being the latest available data.

20.5% 18.5%

15.8%

11.9% 12.0% 12.7% 12.0% 12.9% 13.3% 13.1%

0%

5%

10%

15%

20%

25%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Forest Sector's Share of B.C. Goods Manufacturing GDP, in Current Dollars

Forest Sector Forestry and Logging Support Activities for Forestry

Wood Product Manufacturing Paper Manufacturing








48


Overview Indicator 2c – Wood Product Manufacturing GDP was climbing steadily since the low of 2009, but fell slightly in 2017. Chained dollar GDP adjusts for changes in prices and quantities, and shouldn’t be compared across sectors, nor added across sectors.

$2.9

$2.4 $2.6 $2.8

$3.0 $3.2 $3.2 $3.3

$3.5 $3.5

$0.0

$0.5

$1.0

$1.5

$2.0

$2.5

$3.0

$3.5

$4.0

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

billi

on 2

007$

B.C. Wood Products Manufacturing GDP, in Chained Dollars

Wood Product Manufacturing (2007$)





49

Overview Indicator 2d – This chart shows the GDP of the Paper Manufacturing industry has been relatively stable the last few years. Chained dollar GDP adjusts for changes in prices and quantities, and shouldn’t be compared across sectors, nor added across sectors.

Data source: Statistics Canada; CANSIM 379-0030. Paper Manufacturing includes the Pulp industry.

$1.4 $1.0

$1.2 $1.3 $1.2 $1.1 $1.3 $1.2 $1.2 $1.2

$0.0

$0.5

$1.0

$1.5

$2.0

$2.5

$3.0

$3.5

$4.0

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

billi

on 2

007$

B.C. Paper Manufacturing GDP, in Chained Dollars

Paper Manufacturing (2007$)





50

Data source: Statistics Canada; CANSIM 379-0030. Examples of Support Activities are cruising timber, hauling, pest control, firefighting, and reforestation.

Overview Indicator 2e – The past few years GDP from Support Activities for Forestry has been relatively steady, and so has GDP from Forestry and Logging. Both industries have increased from their levels in 2009. Chained dollar GDP adjusts for changes in prices and quantities, and shouldn’t be compared across sectors, nor added across sectors.

$1.8

$1.2 $1.5

$1.8 $1.8 $2.0 $1.9 $2.0 $2.0 $1.9

$0.5 $0.5 $0.5 $0.6 $0.6 $0.6 $0.6 $0.6 $0.7 $0.7

$0.0

$0.5

$1.0

$1.5

$2.0

$2.5

$3.0

$3.5

$4.0

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

billi

on 2

007$

B.C. Forestry and Logging and Support Activities GDP, in Chained Dollars

Forestry and Logging (2007$) Support Activities for Forestry (2007$)


http://stds.statcan.gc.ca/naics-scian/2007/es-re-eng.asp?criteria=115310


System of National Accounts (SNA): Estimates based on multiple employment sources, including the LFS and SEPH. Part of the Canadian System of Macroeconomic Accounts (CSMA). Estimates are annual and released in the following year (2016 in 2017) making them the least timely source. “Because these accounts [CSMA] all use a common set of definitions, concepts and classifications, and are explicitly

related to each other, they form an integrated system. As a result, the economic stories assembled from the CSMA statistics are coherent and credible. The latter reflects the enhanced quality inherent in an integrated system” (Source).

This is the data source that forms the foundation of Input-Output Models, including BC’s model. Survey of Employment Payrolls and Hours (SEPH): A monthly survey. Not as timely as LFS, SEPH is delayed roughly

two months in comparison. “The payroll survey (SEPH) provides a highly reliable gauge of monthly change in non-farm payroll employment”. “This

survey does not have sampling error since it includes all payroll employees” (Source). Excludes self employed and agriculture. Potentially a major setback for forestry and logging estimates, but probably

less of an issue for most forest product manufacturing. SEPH is usually the lowest employment estimate. Labour Force Survey (LFS): A monthly survey of roughly 6,500 B.C. households out of nearly 2 million (0.3%). It’s released

near the start of each month. “The household survey (LFS) provides a broader picture of employment, including employment in agriculture and the

number of self employed” (Source). It also measures unemployment. Since it is the most timely release on employment it tends to be most widely quoted. This also makes it a useful leading

indicator. The LFS offers employment by Development Region and employment by industry, but the more detailed they become

by Region and industry the less reliable they become. LFS tends to be the upper estimate of the three employment estimates as it reflects all employment.

*Source: Statistics Canada - Comparing SEPH and LFS, System of National Accounts.

51

Multiple Employment Estimates

http://www23.statcan.gc.ca/imdb/p2SV.pl?Function=getSurvey&SDDS=5103

http://www2.gov.bc.ca/gov/content/data/statistics/economy/input-output-model

http://www.statcan.gc.ca/pub/72-203-g/2013001/part-partie8-eng.htm



http://www23.statcan.gc.ca/imdb/p2SV.pl?Function=getSurvey&SDDS=5103


52

Overview Indicator 3a – The System of National Accounts (SNA) offers another estimate of employment. According to this data B.C. forest sector direct employment increased to 57,210 in 2017. The employment in the System of National Accounts combines data from numerous sources.

20.7 17.9 18.6 18.9 19.3 19.3 20.1 20.2 20.6 21.6

27.8 23.9 25.5 24.3 25.3 27.0 27.0 27.2 27.8 28.5

11.2 10.1 9.4 9.0 8.1 8.9 7.9 7.5 7.1 7.1

2.6%

2.4% 2.4% 2.3% 2.3% 2.4% 2.4% 2.4% 2.3% 2.3%

2.1%

2.2%

2.3%

2.4%

2.5%

2.6%

2.7%

0102030405060708090

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

thou

sand

s of p

erso

ns

B.C. Forest Sector Direct Employment: System of National Accounts

Forestry and Logging with Support Activities Wood Product Manufacturing

Pulp and Paper Manufacturing As % of all industries

Data source: Statistics Canada System of National Accounts (SNA): CANSIM 281-0024.

http://www5.statcan.gc.ca/cansim/a26?lang=eng&retrLang=eng&id=2810024&paSer=&pattern=&stByVal=1&p1=1&p2=37&tabMode=dataTable&csid=


53

Overview Indicator 3b – The Survey of Employment, Payrolls and Hours (SEPH) offers another estimate of employment. According to this survey B.C. forest sector direct employment increased to 52,435 in 2017. The SEPH survey only covers employees on payrolls, and so omits self-employed people. This means the estimate should be lower than the LFS.

16.6 13.4 14.2 14.8 15.0 15.3 16.1 17.0 16.9 17.4

31.1 24.8 24.4 24.9 24.7 25.4 26.3 26.4 26.9 27.1

10.7

8.7 7.6 7.3 7.8 7.9 8.2 8.4 7.8 7.9

17.7%

16.0% 15.9% 15.5% 15.3% 15.3% 15.8% 15.8% 15.6% 15.1%

3.0% 2.5% 2.4% 2.4% 2.4% 2.4% 2.5% 2.5% 2.4% 2.4%

0%

5%

10%

15%

20%

25%

0

10

20

30

40

50

60

70

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

thou

sand

s of p

erso

ns

B.C. Forest Sector Direct Employment: Survey of Employment, Payrolls and Hours


Pulp and Paper Manufacturing As % of Goods-Producing Sector

As % of all industries

Data source: Statistics Canada Survey of Employment, Payrolls and Hours (SEPH): CANSIM 383-0031.



54

Overview Indicator 3c – According to the Labour Force Survey (LFS) B.C. forest sector direct employment decreased to 57,100 in 2016, a 4.7% decrease over 2016.

Data source: Statistics Canada Labour Force Survey (LFS) data via B.C. Stats (British Columbia Employment by Detailed NAICS Industry). The LFS samples 6,500 of B.C.’s roughly 2 million households (0.3% of households).

17.2 13.8 16.3 14.6 16.2 17.6 19.2 19.4 19.4 18.6

37.2 31.4 30.8 32.4 29.2 30.2 33.7 36.0 32.0 27.8

12.9 10.3 9.4 8.7 11.4 10.5

12.2 10.1 8.5 10.7

13.8% 12.6% 12.9% 12.9% 12.9% 13.2%

14.5% 14.3% 12.7%

11.6%

3.0% 2.5% 2.5% 2.5% 2.5% 2.6% 2.9% 2.8% 2.5% 2.3%

0%

5%

10%

15%

20%

25%

0

20

40

60

80

100

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

thou

sand

s of p

erso

ns

B.C. Forest Sector Direct Employment: Labour Force Survey


Pulp and Paper Manufacturing As % of Goods-Producing Sector

As % of all industries

http://www.bcstats.gov.bc.ca/StatisticsBySubject/BusinessIndustry/BusinessCountsEmploymentByIndustry.aspx


55 Overview Indicator 3d – According to the Labour Force Survey (LFS) the coast is usually around 45% of B.C. forest sector direct employment while the interior is around 55%.

Data source: Statistics Canada Labour Force Survey (LFS) data via B.C. Stats (Employment and Unemployment by Development Region). In this data North Coast is combined with Nechako, and in this chart North Coast-Nechako is included in the Interior.

50% 49% 46%

49% 44%

47% 46% 49%

45% 45%

50% 51% 54%

51% 56%

53% 54% 51%

55% 55%

0%

10%

20%

30%

40%

50%

60%

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Shar

e of

Em

ploy

men

t

Forest Sector Employment Share by Coast and Interior

Coast Share Interior Share

http://www.bcstats.gov.bc.ca/StatisticsBySubject/BusinessIndustry/BusinessCountsEmploymentByIndustry.aspx

http://www.bcstats.gov.bc.ca/StatisticsBySubject/Geography/ReferenceMaps/DRs.aspx


56

Data source: B.C. FLNR Harvest Billing System. All logs, special forest products, species and grades billed, excluding waste, reject and Christmas trees. Data extracted May 1, 2017.Volumes may not add to total harvest (slide 16) due to rounding.

Products – Logs – Total harvest volume (64.3 million m³) was down 2.9% from 2016. The Interior accounted for 74% of the harvest. Most of the harvest from private and federal lands comes from the Coast. Recent interior harvest is near pre-beetle, pre-housing boom levels (49.2 million m3, ‘95-’99).

44.1 36.5 45.5 49.3 48.6 49.6 45.4

48.9 45.9 45.5

1.6 1.2

1.3 0.9 1.0 1.2 1.7 2.0 1.9 2.2

0

20

40

60

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

mill

ion

m³

B.C. Interior Harvest Volume

Crown Land Private/Federal Land Average Pre-Beetle Harvest ('95-'99)

15.4 14.0 12.9 10.9 7.9 12.3 14.2 14.3 15.1 13.9

6.4 6.0 5.8 4.5 3.3

4.2 5.2 4.1 5.1 5.4

0

10

20

30

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

mill

ion

m³

B.C. Coast Harvest Volume

Crown Land Private/Federal Land

https://a100.gov.bc.ca/pub/hbs/


57

Data source: B.C. Mill Report. 2016 is the latest year available. See page 9 for additional breakdown.

Products – Log use by Mill Type – This table shows estimated log use by mill type based on results from the B.C. Mill Survey. The vast majority of logs initially wind up at lumber mills (73%), then roughly 56% of that fibre goes to pulp and pellet mills as chips and sawdust. Note, the annual survey’s estimated log use was 3.1% higher than harvest (2015 was 3% under harvest).



58

Data source: B.C. Mill Report. 2016 is the latest year available. See page 9 for additional breakdown.

Products – Log use by Mill Type – This is a summary of some of the data on the previous page.



59

Products – Exports – Share of B.C. forest product export value by main product in 2017: Logs (5.7%), Softwood Lumber (46.8%), Other Wood Products (16.3%), Pulp (24.5%), and Other Paper Products (6.8%).


$3.6 $2.7 $3.6 $3.8 $4.2 $5.3 $5.7 $5.8 $6.7 $6.6

$2.9 $2.1

$2.9 $3.2 $2.9 $2.8

$3.1 $3.3 $3.0 $3.5

$1.5

$1.1

$1.2 $1.3 $1.4

$1.6 $1.6 $1.9

$2.3 $2.3

$1.8

$1.4

$1.1 $1.1 $1.1

$1.1 $1.1

$1.1 $0.9 $1.0

$0.3

$0.2

$0.4 $0.6 $0.6

$0.8 $0.8 $0.7

$0.8 $0.8

$10.1

$7.6

$9.1 $10.0 $10.2

$11.7 $12.4 $12.8

$13.7 $14.2

$0

$2

$4

$6

$8

$10

$12

$14

$16

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

billi

on C

A$

B.C. Forest Product Exports by Main Product

Softwood Lumber Pulp Other Wood Products Other Paper Products Logs




60

Products – Exports – Softwood Lumber – Spruce-Pine-Fir (SPF) lumber is by far the highest-volume lumber product exported from B.C., followed by Douglas Fir, Western Red Cedar, and hemlock-fir (balsam). Non-SPF species tend to have higher lumber prices than SPF, as seen by their export value share being higher than their volume share.


Spruce-Pine-Fir

74%

Western Red Cedar

6%

Douglas Fir 7%

Hem-Fir 5%

Other 8%

B.C. Softwood Lumber Export Volume (25.3 million m3) Share by Species,

2017

Spruce-Pine-Fir

62%

Western Red Cedar 16%

Douglas Fir 9%

Hem-Fir 5%

Other 8%

B.C. Softwood Lumber Export Value (CA$6.6 billion) Share by Species,

2017




61

Products – Exports – Logs – Log export volume declined by 4.6% in 2017. The vast majority of log exports came from the Coast, rather than the Interior.

Data source: B.C. FLNRO Harvest Billing System, and B.C. Stats extract from Statistics Canada data. Also available from Statistics Canada CIMTD. Note historic data is subject to revisions.

2.6 2.5

3.7

5.4 5.7 6.7 6.3

5.6 6.3 6.0 4.3%

5.0% 5.9%

7.8% 8.4%

9.4% 9.4%

8.1%

9.5% 9.3%

0%

2%

4%

6%

8%

10%

12%

0

2

4

6

8

10

12

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

mill

ion

m3

B.C. Log Export Volume and Share of Harvest

Volume - m³ As % Share of Total Harvest




62

Products – Exports – Logs – Hemlock sawlogs accounted for around 50% of log exports in 2017, followed by Douglas Fir with 33%. Most of the hemlock went to China which is one of the few markets where the species is in strong demand.

Data source: B.C. Stats extract from Statistics Canada data. Also available from Statistics Canada CIMTD. Other includes pulp logs of all species, plus saw logs of other softwoods and hardwoods. Note historic data is subject to revisions.

Hemlock 50.0%

Douglas Fir 33.1%

Spruce 8.8%

Other 8.1%

B.C. Log Export Volume (6.0 million m3) Share by Species, 2017




63

Products – Exports – Pellets – Exports of Wood Waste and Scrap grew rapidly up to 2011, probably almost entirely due to growth in Pellet exports. Pellet export value jumped over $100 million from 2015 to 2016. 2017 was down slightly from 2016. The first year pellets were given their own product category in the export data was 2012.


$103.9

$140.8

$195.4 $207.4

$6.7 $5.0 $5.9 $8.8 $6.1 $4.3

$174.0 $194.8 $202.7 $201.0

$318.9 $311.3

$0

$50

$100

$150

$200

$250

$300

$350

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

mill

ion

CA$

B.C. Exports of Wood Waste and Scrap, and Pellets

Wood Waste and Scrap Pellets

*Pellets were included in Wood Waste and Scrap until 2012. Now pellets are separate.




64

Products – Imports – Value – Total value of imported forest products was fairly consistent the past three years. Note the final destination of these imports may have been other provinces. Pulp and log imports are included in the total, but not given their own line due to the low overall value. Top imports of Other Wood products include furniture (especially chairs), particle board, siding and plywood. Top imports of Other Paper products include corrugated packaging, toilet paper, and paper towels.

Data source: Special run of Statistics Canada data via BC Stats. Similar data can be viewed on NRCAN’s website. Note historic data is subject to revisions.

$694 $634 $660 $670 $653 $705 $776 $860 $815 $838

$1,202 $1,014 $1,098 $1,092 $1,174 $1,233

$1,345 $1,482 $1,499 $1,470

$1,991 $1,742

$1,881 $1,881 $1,945 $2,080

$2,274 $2,489 $2,469 $2,463

$75 $75 $103 $97 $100 $129 $143 $137 $146 $144

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

mill

ion

CA$

B.C. Forest Product Import Value by Product Category

Other Paper Other Wood Total value of imports Softwood Lumber*Pulp and Log import value is minimal, so they don't have their own series, but are included in the total.

https://cfs.nrcan.gc.ca/statsprofile/trade/bc


65

Products – Imports – Quantity – Imports of softwood lumber declined from 2016 to 2017. Comparing import volume to B.C. production it is only about 1.8%. Coniferous wood chip imports increased in 2017. Note the final destination of these imports may have been somewhere else in Canada.


0.39 0.47

0.71 0.47

1.08

0.80 0.80 0.82 0.73

0.58

0.066 0.038 0.039 0.094 0.055 0.092 0.107

0.056 0.015 0.027

0.90

0.46 0.56

0.63

0.73

0.90 0.95

0.83

0.65

0.86

0.0

0.2

0.4

0.6

0.8

1.0

1.2

0.0

0.2

0.4

0.6

0.8

1.0

1.2

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

mill

ion

tonn

es

mill

ion

m3

Select B.C. Forest Product Imports by Quantity

Softwood Lumber (m3) Log (m3) Coniferous Wood Chips (Tonnes)



66

Products – Import vs. Export Value – Other wood and other paper are the largest imports to B.C. Import value is about 18% the size of export value. Note the final destination of these imports may have been elsewhere in Canada, and that products imported to other provinces may have been used In B.C.


Comparison of BC Forest Product Exports and Imports

Log, $0.00

Other Paper, $0.84 Other Wood,

$1.47

Pulp, $0.01

Softwood Lumber,

$0.14

2017 Forest Product Imports - $2.5 billion

Logs , $0.81 Other Paper,

$0.96

Other Wood, $2.30

Pulp , $3.47

Softwood Lumber,

$6.62

2017 Forest Product Exports - $14.2 billion



67

Markets – Starting in 2005 the U.S. share of export value fell dramatically and China’s share grew rapidly. This trend ended in 2012 and their shares slowly diverged after that. In 2017 the U.S. lost share to China.


55.5% 52.8%

45.1%

38.3% 42.8% 42.7% 44.7%

48.0% 52.1%

48.9%

11.8% 16.5%

24.1%

32.6% 30.6% 31.4% 30.5% 28.8% 24.9%

27.2%

0%

10%

20%

30%

40%

50%

60%

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

B.C. Forest Product Export Value Share by Market

U.S. China + Hong Kong Japan Other




68

Markets – U.S. – U.S. softwood lumber consumption and U.S. housing starts have increased steadily from the low in 2009, but both are still far from the peak level in 2005.

Data source: Western Wood Products Association and U.S. Census Bureau.

40.9

31.5 32.8 34.0 36.5 39.5

42.4 44.4 47.4 48.0

6.9 5.0 5.3 4.8 5.3 5.9 6.2 6.7 7.6 6.9

900

554 587 609 781

925 1,003 1,112 1,174 1,203

0

500

1,000

1,500

2,000

2,500

3,000

3,500

0

10

20

30

40

50

60

70

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Hous

ing

Star

ts, t

hous

ands

uni

ts

billi

on b

d ft

U.S. Softwood Lumber Consumption vs. Housing Starts

Lumber Consumption Lumber Imports from B.C. U.S. Housing Starts

http://www.wwpa.org/

https://www.census.gov/construction/nrc/index.html


69

Markets – U.S. – U.S. softwood lumber consumption relies primarily on U.S. domestic supply. The U.S. is still supplying a higher level of their consumption than during the housing boom, largely due to lower lumber demand resulting in less need for imports. Canada provided 29.8% of total U.S. consumption in 2017.

Data source: Western Wood Products Association. The supply share from B.C. in 2016 was altered to match revised Statistics Canada data (no longer matches WWPA data).

16.9% 15.9% 16.0% 14.1% 14.6% 15.0% 14.6% 15.0% 16.0% 14.4%

11.3% 10.2% 11.3% 11.7% 11.3% 12.5% 13.8% 14.7% 15.7% 15.4%

69.2% 72.1% 71.3% 72.9% 73.2% 71.4% 70.2% 68.8% 66.3% 67.3%

0%

10%

20%

30%

40%

50%

60%

70%

80%

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Supplier Share of U.S. Softwood Lumber Consumption

B.C. Rest of Canada Non-Canadian U.S.

http://www.wwpa.org/


0

20

40

60

80

100

120

140

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Exch

ange

Rat

e In

dex

US$ Exchange Rates Indexed to 2000

CA$/US$ Yuan/US$ Yen/US$

70

Data source: Organization for Economic Co-operation and Development (OECD).

Markets – Prices and Costs – From 2002 to 2011 the US$ depreciated about 33% relative to the Canadian dollar. From 2011 to 2016 the US$ appreciated against the CA$, but 2017 had a slight depreciation. The exchange rate impacts product prices and mill revenue.

2000 Exchange Rates 1.48 CA$/US$ 8.28 Yuan/US$ 107.82 Yen/US$

2017 Exchange Rates 1.30 CA$/US$

6.76 Yuan/US$ 112.16 Yen/US$

http://stats.oecd.org/index.aspx?queryid=169


71

Markets – China – In 2017, Russia’s share increased to 41.7% while Canada’s became 13.7%. Despite a large increase in lumber imports the volume from Canada declined slightly.

Data source: WOOD MARKETS China Bulletin. All species, including hardwoods.

13.7%

41.7%

8.6%

22.0%

14.7

21.5 20.6 23.9

25.6 26.6

31.4

37.3

0

5

10

15

20

25

30

35

40

2010 2011 2012 2013 2014 2015 2016 2017

mill

ion

m³

China Lumber Imports by Supply Country

Canada Russia U.S. Other

https://www.woodmarkets.com/


72

Markets – China – In 2017 Canada (14.8%) was second behind Brazil (25.3%) as the leading supplier of China’s kraft market pulp imports. They were followed by Indonesia (14.8%), the U.S. (10.1%), and other countries (35.0%). China’s sulfate kraft pulp imports increased substantially in 2017.

Data source: WOOD MARKETS China Bulletin.

14.8%

25.3%

10.1% 14.8%

35.0%

8.9

11.7 13.3 13.6 14.3

15.8 17.0

19.2

0

5

10

15

20

25

2010 2011 2012 2013 2014 2015 2016 2017

mill

ion

tonn

es

China Sulfate (Kraft) Wood Pulp Imports by Supply Country

Canada Brazil U.S. Indonesia Other



73

Markets – China – In 2017 New Zealand continues as China’s largest log supplier (25.9%). They were followed by Russia (20.3%), the U.S. (11.0%), Canada (6.1%) and other countries (36.7%).

Data source: WOOD MARKETS China Bulletin. All species, including hardwoods.

20.3%

25.9%

11.0% 6.1%

36.7%

34.3

42.3 37.9

45.2

51.4

44.6 48.7

55.4

0

10

20

30

40

50

60

2010 2011 2012 2013 2014 2015 2016 2017

mill

ion

m³

China Log Imports by Supply Country

Russia New Zealand U.S. Canada Other



74

Markets – B.C.’s Share – B.C.’s share of Canada’s total softwood lumber export value was 63.4% in 2017, decreasing from 2016.


$3.6 $2.7 $3.6 $3.8 $4.2 $5.3 $5.7 $5.8 $6.7 $6.6 $5.1

$3.8 $4.8 $5.2 $5.7 $7.4 $8.3 $8.5

$10.0 $10.4

70.8% 73.1% 73.5% 74.2% 73.5% 71.6% 68.6% 68.2% 66.9%

63.4%

0%

10%

20%

30%

40%

50%

60%

70%

80%

$0

$2

$4

$6

$8

$10

$12

$14

$16

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

billi

on C

A$

Softwood Lumber Exports: B.C. and Canada

B.C. Canada B.C. % Share of Canada




75

Markets – B.C.’s Share – In terms of value B.C. is the dominant supplier of Canada’s softwood lumber exports, followed by Quebec, Alberta, Ontario and other provinces.


British Columbia 63%

Quebec 14%

Alberta 10%

Ontario 6%

Other Provinces 7%

Canada Softwood Lumber Export Value ($10.4 billion) by Province, 2017




76

Markets – B.C.’s Share – B.C. accounted for 44.3% of Canada’s total pulp export value in 2017. B.C. sells a greater proportion of its pulp production compared to other provinces which make more paper.


$2.9 $2.1

$2.9 $3.2 $2.9 $2.8 $3.1 $3.3 $3.0 $3.5

$7.0

$5.1

$7.0 $7.2 $6.4 $6.7 $7.2 $7.7 $7.2 $7.8

41.2% 40.5% 41.9% 44.4% 44.4%

42.0% 43.3% 42.9% 41.6% 44.3%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

$0

$1

$2

$3

$4

$5

$6

$7

$8

$9

$10

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

billi

on C

A$

Pulp Exports: B.C. and Canada

B.C. Canada B.C. as % Share of Canada




77

Markets – B.C.’s Share – B.C. is the largest supplier of Canada’s pulp exports in terms of value, followed by Alberta, Quebec, New Brunswick and other provinces. B.C.’s primary market is China. The two other large exporters, Alberta and Quebec, export large amounts to both China and the USA.


British Columbia 44.3%

Alberta 19.6%

Quebec 16.7%

New Brunswick 7.6%

Other Provinces 11.8%

Canada Pulp Export Value ($7.8 bil.) by Province, 2017




78

Markets – B.C.’s Share – B.C. accounted for 26.4% of the value of Canada’s total forest product exports to the U.S. in 2017. B.C. exports declined by CA$0.2 billion and exports from Canada as a whole rose CA$0.2 billion.


$5.6 $4.0 $4.1 $3.8 $4.3 $5.0 $5.5 $6.1 $7.1 $6.9

$23.1 $17.9 $18.0 $17.3 $17.1

$19.4 $21.7

$24.0 $26.0 $26.2

24.3% 22.5% 22.9% 22.1%

25.5% 25.7% 25.5% 25.6% 27.5% 26.4%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

$0

$5

$10

$15

$20

$25

$30

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

billi

on C

A$

Forest Product Exports to U.S.: B.C. and Canada

From BC From Canada B.C. % Share of Canada




79

Markets – B.C.’s Share – B.C. accounted for 69.6% of Canada’s total forest product exports to China in 2017.


$1.2 $1.3

$2.2

$3.3 $3.1 $3.7 $3.8 $3.7 $3.4 $3.8

$1.8 $1.9

$3.0

$4.2

$4.2

$4.7

$4.8 $5.0 $4.9 $5.5 67.2% 67.1%

73.6%

77.2%

74.4%

77.4% 78.0%

73.3%

70.0% 69.6%

60%

62%

64%

66%

68%

70%

72%

74%

76%

78%

80%

$0.0

$1.0

$2.0

$3.0

$4.0

$5.0

$6.0

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

billi

on C

A$

Forest Product Exports to China: B.C. and Canada





80

Markets – B.C.’s Share – B.C. accounted for 87.3% of Canada’s total forest product exports to Japan in 2017.


$1.2 $0.9 $1.1 $1.2 $1.1 $1.3 $1.3 $1.2 $1.2 $1.3 $1.5 $1.1 $1.4 $1.4 $1.3 $1.6 $1.5 $1.4 $1.4 $1.5

85.0% 83.1% 82.2% 83.0% 84.2% 84.5% 84.2% 83.5% 84.9% 87.3%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

$0.0

$0.5

$1.0

$1.5

$2.0

$2.5

$3.0

$3.5

$4.0

$4.5

$5.0

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

billi

on C

A$

Forest Product Exports to Japan: B.C. and Canada





The multipliers presented below are FLNRORD estimates of the contribution to key BC economic indicators of one million cubic metres of harvest. These estimates are based on a special run of the B.C. Input-Output Model (the IO Model). The Ministry uses these multipliers for economic impact analysis, such as the harvest impacts presented in Timber Supply Reviews.

The estimates combine impacts for the four forestry related industries reported by Stats Canada (Forestry and Logging with Support Activities, Wood Product Manufacturing, and Paper Manufacturing), and remove double counting of impacts that could arise because of inter-industry linkages (termed “delinking”)

Impacts are presented for Output (sales value), Gross Domestic Product (GDP), Household Income, Employment, and Tax Revenue (corporate, income, and commodity taxes).

Direct impacts and total impacts are shown. Total impacts include direct impacts, indirect impacts (on suppliers to the industry), and induced impacts (from direct and indirect employees spending their wages).

These multipliers are calculated based on Statistics Canada’s information for 2011 and are currently being updated to the latest National Accounts data which is 2014. 81

Forest Sector Economic Multipliers

Impact per million m3 of Harvest (excludes waste and reject) - dollar values in millions

2011 Basis Impact Type Output GDP Household Income Employment Provincial Tax

Revenue

Provincial Direct $256 $83 $62 763 $5.5 Total (Direct + Indirect + Induced) $368 $136 $96 1,287 $9.7

https://www2.gov.bc.ca/gov/content/data/statistics/economy/input-output-model

https://www2.gov.bc.ca/gov/content/data/statistics/economy/input-output-model

http://www23.statcan.gc.ca/imdb/p3VD.pl?Function=getVD&TVD=307532&CVD=307534&CPV=113&CST=01012017&CLV=2&MLV=5





https://www.statcan.gc.ca/eng/nea/list/nea


Additional Sources for Data

Canadian National Forestry Database.

Food and Agriculture Organization of the United Nations (FAO)

Natural Resources Canada Forestry Statistics

82

http://nfdp.ccfm.org/

http://faostat3.fao.org/download/F/FO/E

https://cfs.nrcan.gc.ca/statsprofile

Documents

2017 economic state of the B.C. forest sector - llbc.leg.bc.ca · Ministry of Forests, Lands, Natural Resource Operations and Rural Development 2017 Economic State of the B.C. Forest