Forest Products Association of Canada

Economy And Trade

The Canadian forest products industry has always relied heavily on exports for its prosperity. The overall value of Canada’s forest products exports was just over $31 billion in 2014. Canada ranked as the world’s second largest exporter of forest products and the sector is the second biggest contributor to Canada’s trade surplus at $20.9 billion.

The industry wants those numbers to grow. Increasing trade with new and existing markets will be necessary for a vibrant Canadian forest products sector, especially in the face of growing international competition.

A notable success in recent years has been the diversification of our trade relationships. The dependence on the U.S. market has dropped over the past decade from 80% to around 66%. Forest products are now Canada’s largest export to Asia while exports to China have soared by 369% over the last decade.

As markets emerge for products based on renewable materials, FPAC and its partners see a central role for the forest industry in this bio-economy. 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.

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 the new free trade agreements with the European Union and Korea will be helpful, and FPAC continues to work in close cooperation  with the Government of Canada, including the Department of Foreign Affairs, Trade and Development Canada, to negotiate additional free trade agreements. Initiatives such as Trans-Pacific Partnership Negotiations; Canada-India; Canada-Japan; and the World Trade Organization (WTO) Environmental Goods Agreement negotiations will further facilitate international trade of Canada’s forest products.

At the same time exports to the United States are rebounding with housing starts recovering to around the one million mark, and 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 continues its attempts to increase exports, it becomes more crucial to remedy Canada’s transportation system. Right-sizing the transportation system will be necessary to ensure the sector retains its reputation as a reliable global supplier meeting trade flows beyond north-south and towards east-west.