Products

In 2012, FPAC launched the Vision2020 challenge and we committed to reporting publicly on the collective progress of the industry every two years. Below you will find our first progress report looking back to the years 2010 to 2012 on the Products goal of generating an additional $20 billion in economic activity from new innovations and growing markets.

Context

The products goal reflects the optimism of the forest product industry about its ability to create new economic activity through innovation.
The forest products industry has a long history of adopting new innovative processes and technologies. Through the challenges of recent years, the sector’s need to innovate has deepened as it sought new ways to maximize value from Canada’s forests. Industry and government players realized that innovation in knowledge, products, policy and processes is necessary for the industry’s future success.

Progress to Date

As one might expect, adopting new products and entering new markets does not happen overnight. The results thus far are modest and do not yet capture the full extent of the effort being made by the industry and its partners. In the two years between 2010 and 2012 when the industry was still recovering from the recession, it was also making strategic investments for future growth. The figures for 2013 and 2014 are expected to show a further pick up. For example, initial figures show wood exports went up 27% in 2013 and Statistics Canada reports that the GDP of Canada’s forest products industry grew by 3.4% in 2013, faster than the overall economy (2%).

As the industry moves into new products and new customers, the way it accounts for our economic activity will also need to evolve. In developing this first report card for Vision2020, FPAC realized that the Statistics Canada measurement of economic activity in the forest sector doesn’t include a separate category to measure bio-energy and other bio-products created by our companies.

Further improvements in economic activity are expected as the global recovery takes hold, as a more diversified portfolio of new innovative products comes on stream and as Canada takes advantage of expanding markets. The signing of new free trade agreements such as those with the European Union and Korea will also be helpful. At the same time exports to the United States are rebounding with housing starts recovering to around the one million mark. The recent weakening of the Canadian dollar will also generate a competitive advantage in the international marketplace for years to come.

As the forest products sector attempts to increase exports, it continues to be challenged by a stressed transportation system especially as trade flows move beyond north-south to east-west. Right-sizing the transportation system will be necessary to ensure the sector retains its reputation as a reliable global supplier.

Building the Momentum

The opportunity to extract increased value from every tree harvested is dependent on ingenuity, continuous innovation and aggressive pursuit of new products and new markets. The activities of individual companies will continue to propel this growth. But no one company can do it alone. In the first two years of Vision2020, FPAC has already identified many ways that government policy, ongoing research and effective partnerships can assist in reaching the ambitious goal of generating an additional $20 billion in new products and markets. Collaborative effort towards forest sector innovation through unique partnerships between governments, academics, technology developers and the industry is necessary to drive progress forward. Read the proposals that would help the industry reach the Vision2020 goal on page 10: Vision2020 Report Card: 2010 – 2012

Resources