THE FOREST PRODUCTS ASSOCIATION OF CANADA – HELPING INDUSTRY THRIVE

Canadians have something to celebrate during this United Nations International Year of the Forests – how our forest products sector is emerging from the severe downturn poised to be a robust part of Canada’s economic, environmental and social future.   And while each company worked to renew itself, the sector used its national association― the Forest Products Association of Canada (FPAC)― to open pathways for that renewal. 

The past five years have been difficult for the forest products sector as numerous facilities closed and some 90,000 jobs were lost.  Companies knew that markets would eventually return but they also realized aggressive, heavily subsidized producers from Brazil, China and Indonesia have made the post-recession marketplace more competitive.  

The Canadian industry recognizes that simply waiting for markets to rebound isn’t a strategy for success and that Instead companies must retool and embrace a new business model.  While each of FPAC’s 21 member companies embraced their own strategy, the sector as a whole turned to FPAC to establish an industry roadmap. That roadmap involves a four-pronged approach. 

First, companies are taking steps to improve productivity and cost efficiencies.  In this regard, FPAC has supported the industry by working with governments on such issues as tax policy, rail transportation and mergers.   Our sector now consistently outperforms the overall Canadian economy as well as our U.S. counterparts in productivity growth.

Second, the industry is expanding its reach to markets beyond North America.  Instead of waiting for the return of the U.S. housing market, the industry has boldly begun to cultivate new markets. Forest products are now Canada’s number one export to China and India.  FPAC provides the industry with market outreach and advocacy to support the use of wood by commercial builders around the world.

Third, the sector is using FPAC to help translate its superior environmental performance into reputational capital.  All forest management practices must be certified by an independent third-party as a condition of membership― a world first.  And one year ago member companies under the FPAC banner joined forces with leading environmental groups to sign the landmark Canadian Boreal Forest Agreement.  FPAC continues to work with companies to improve environmental performance and seek market advantage over global competitors.

The final game-changer comes from innovation and the drive to extract more value from every tree in the form of bio-fuels, bio-materials, and bio-chemicals.  Following interest from member companies, FPAC undertook the Future Bio-Pathways Study which confirmed that lumber, and pulp and paper operations would benefit economically by adding bio-products to their mix.  FPAC has also succeeded in bringing the federal government on board to help the industry transform and take advantage of the new bio-economy.

All told, new efficiencies, expanding markets, green credentials and innovation provide Canada’s forest products industry with the means to not just survive but thrive in the years ahead.  The future looks bright― exports and prices are rising and companies are embracing new products and markets.  The increase in demand from a growing and increasingly affluent global population also ensures that Canada’s abundant forest resource offers a clear economic edge for Canada for decades to come.

FPAC will continue to play a leadership role in the industry’s renewal by working with governments to help industry develop clean energy and recruit new workers.  FPAC will also ensure that governments understand the high cost challenges facing industry including the strong Canadian dollar.  Most importantly, FPAC will build on its strength as the central forum for its members to work together so that Canada’s forest products industry remains a dynamic world leader in exports, environmental performance and innovation.