B.C. Forests MInister Doug Donaldson (right side centre) meets with housing ministry officials in Jiangsu province, China, Nov. 15, 2017. Jiangsu, population 79 million, is China’s pilot project for wood and hybrid wood construction. (B.C. government photo)

B.C. VIEWS: China a better partner for forest industry than U.S.

B.C. is slowly winning the softwood lumber war

B.C. Forests Minister Doug Donaldson is back from his first wood industry trade mission to China and Japan, an annual journey I was fortunate to go on last year.

China especially is an eye-opening experience, and depending on the smog, an eye-irritating experience as well. The sheer scale of urban development around cities like Shanghai and Nanjing is striking – they don’t build a high-rise, they build eight or 10 or 12 at a time.

Nanjing is the commercial centre of Jiangsu province, where the Chinese central government has ordered a pilot project to phase in wood and engineered wood, starting with roof trusses and pre-fabricated infill walls for concrete buildings. They’re working with B.C.-developed wood construction because “it’s energy efficient, it’s green, it’s light, it’s fast,” says Rick Jeffery, chair of the national industry group Canada Wood and a veteran of Asia trade.

This is important in a vast country that is not only choked with pollution, it’s running low on limestone, a key component of concrete. Based on 2016 rates of consumption, China is using as much concrete in two years as the U.S. would in a century, and that’s with their growth slowed from its peak a few years ago.

One of the pictures sent back by B.C. government staff shows Donaldson attending a meeting of the Ministry of Housing and Urban-Rural Development (MOHURD) for Jiangsu, with dozens of people crowded around a long boardroom table. The province’s population is approaching 79 million.

In a phone call from the Tokyo stop last week, Donaldson said once the government decides on an action, “things happen quickly in China.” The national MOHURD directs the provinces and essentially controls construction.

Donaldson noted that President Xi Jinping, in his recent sweeping address to the 19th Congress of the Communist Party of China, emphasized clean, pre-fabricated building systems.

Things don’t happen quickly in wood industry talks with the U.S., where the central government isn’t ruled by dictators but by its lumber industry lobby. Using the same subsidy accusations that have failed repeatedly in international trade rulings, the U.S. has forced Canadian softwood producers to fork over $500 million in countervailing and anti-dumping duties since last spring alone.

This American shakedown of Canada has been going on for decades. In the “managed trade” arrangement that ran from 2006 to 2015, Canadian lumber mills paid punitive duties averaging about 11 per cent. Now, after a preliminary ruling was generously scaled back by the U.S. Department of Commerce, our producers are paying about 20 per cent, directly into the pockets of U.S. lumber barons.

B.C. Council of Forest Industries CEO Susan Yurkovich has repeatedly pointed out that this U.S. protectionism doesn’t work. It can’t work, because the U.S. doesn’t produce enough lumber to meet its own construction demand. If it blocks lumber from B.C., which represents half of Canada’s exports south, it will have to buy lumber from overseas.

The real purpose of this U.S. industry trade bullying is to push up the price of their products, and that is working extremely well. U.S. lumber and structural panel prices hit a near record last week.

The good news for B.C. is that the price is high enough that sales to the U.S. are easily covering the cost of duties. That’s being passed on to U.S. builders and homeowners.

One of these days, Trump and his team of trade geniuses may figure this out and begin to consider free trade in lumber. Until then, Canada and B.C. are well advised to continue working on the Asia market.

Tom Fletcher is B.C. legislature reporter and columnist for Black Press. Email: tfletcher@blackpress.ca


@tomfletcherbc
tfletcher@blackpress.ca

Like us on Facebook and follow us on Twitter.

Just Posted

Open burns now allowed in Kamloops Fire Centre

Anyone lighting an open fire still has to comply with B.C.’s air quality control laws

TLC completes fundraising campaign to protect Clearwater wildlife corridor

Land Trust protects additional 10 acres of migratory wildlife corridor

Water issues returning to normal for Vavenby

Sediment in river caused boil water advisory for community

Sikh community loses longtime member, closes temple

Holy Scripture will now be moved to Kamloops

RCMP police report

Clearwater RCMP responded to 42 calls for service over this past week

VIDEO: Neighbours fear impact of B.C. tent city residents

Greater Victoria residents opposed to campers voice concerns at provincial campground

B.C. premier apologizes for removal of 1950s totem pole at Canada-U.S. border

First Nations say pole was raised at Peace Arch but removed to make way for tourism centre

‘Summer from hell’: vandals rob Fort St. James community garden following devastating wildfire season

The community rallied to keep the Health Minds Community Garden open in Fort St. James

Tornado touches down in Ottawa and Gatineau, Que.

Environment Canada says cars and homes have been damaged by severe thunderstorms and high wind gusts

An unexpected sight: Bear spotted eating another bear in central B.C.

Cheslatta Carrier Nation Chief finds bear eating another bear’s carcass

RCMP confirm death of missing BC teen Jessica Patrick

No details on cause were given. Case is under criminal investigation and police are asking for tips.

CUTENESS OVERLOAD: 2 sea otters hold hands at the Vancouver Aquarium

Holding hands is a common – and adorable – way for otters to stay safe in the water

B.C. teen with autism a talented guitarist

Farley Mifsud is gaining fans with every performance

Yukon man facing new attempted murder charge in B.C. exploding mail case

Leon Nepper, 73, is now facing one charge each of aggravated assault and attempted murder

Most Read