Forestry pains continue

The announcement on Tuesday that Nanaimo's Madill Equipment has gone bankrupt is just the latest set back in the province's beleaguered forest industry that has seen mills and jobs decimated in the Nanaimo-area and across B.C. over the past few years.

Evidence of just how much B.C.'s coastal forest industry, which has employed about 12,000 people in better days, is suffering is evident at the old Doman mill site in Chemainus where more than 400 pieces of forestry equipment -- including grapple yarders, skidders and logging trucks -- will be going to the highest bidder when the Ritchie Brothers hold a massive auction in a few weeks.

For some it may be a chance to pick up equipment, much of which was originally purchased by forestry companies from Madill Equipment, for a steal, but for some observers the sale is a reflection of what's happening in the coastal forest industry.
.C.'s once-mighty forest industry left reeling by changes: Arnie Bercov, vice-president of Pulp, Paper and Woodworkers of Canada Local 8, representing Harmac pulp mill workers, is concerned about the future of the province's forest industry as mills and forestry-related businesses, like Nanaimo's Madill Equipment, continue to close.View Larger Image View Larger Image
.C.'s once-mighty forest industry left reeling by changes: Arnie Bercov, vice-president of Pulp, Paper and Woodworkers of Canada Local 8, representing Harmac pulp mill workers, is concerned about the future of the province's forest industry as mills and forestry-related businesses, like Nanaimo's Madill Equipment, continue to close.
Krista Charke photo

"It probably tells me there's more equipment than there is work," Rick Jeffery, president of the Coast Forest Products Association, told the press earlier this week.

Mill shut downs and lay-offs have become common-place along B.C.'s coast and in the Nanaimo-area in the last few years.

Cascadia Forest Products closed the gates at Nanaimo's Island Phoenix sawmill for good in Dec., 2005, putting about 120 workers out of work after the owners determined the mill was no longer viable.

Western Forest Products laid off hundreds of mid-Island workers, including 110 workers at the company's sawmill in Ladysmith and 130 workers at its Campbell River mill, last year for an indefinite period until the lumber market rebounds.

WFP decided to continue operations at its two mills in Nanaimo, employing about 300 workers, "for the time being" because the markets were still favourable for their products.

But the Duke Point mill continued to operate with just the two shifts, instead of the usual three, that were reinstated after the 13-week coastal forestry strike ended last fall until markets improve.

WFP also decided to curtail logging at its WFP's Mid-Island Timberlands Division, out of Campbell River, at the same time, affecting about 130 forestry workers and some contractors.

The fate of Nanaimo's Harmac pulp mill, employing 530 workers, remains uncertain as the employees wait for the mill's new owners, Asia Pulp & Paper, to take over operations later this month from bankrupt Pope & Talbot.

Harmac requires major upgrades, perhaps costing as much as $100 million, to make it internationally competitive and some industry analysts fear the mill's new owners may decide to shut down operations.

The closure of Nanaimo's Madill Equipment on Tuesday, laying off upwards of 190 people, is just the latest chapter in the demise of an industry that has long dominated B.C.'s economy.

Industry analysts point to a variety of reasons for the forest industry's problems, with the latest related to the strength of the Canadian dollar which has hurt exports to international markets, particularly the U.S., as well as the ongoing housing slump in the U.S. which has diminished demand for B.C. lumber.

But some say many of the problems began in 2003 when the province passed the Forest Revitalization Act which the government felt would revitalize the industry.

Critics say the legislation has "broken the social contract" because tenure s were no longer attached to having mills established nearby which has seen forest companies increasingly send raw logs, which don't face tariffs, from Vancouver Island to U.S. mills for processing.

Additionally, the raw-log exports have caused shortages of wood chips and hog fuel, that many of the coast's pulp and paper mills rely on for energy to run their operations, which is having deep impacts on operations like Harmac.

As well, many forest companies have refrained from investing into their mills over the years leaving them noncompetitive in the international market place where new state-of-the-art mills, that are less labour-intensive than many of B.C.'s mills, are processing more lumber at cheaper rates.

With B.C.'s forest industry facing the worst downturn in recent memory, Premier Gordon Campbell's announced a new review in January, which he calls a "working roundtable", to discuss the industry.

The roundtable, which includes forest minister Rich Coleman, lands minister Pat Bell, Nanaimo-Parksville MLA Ron Cantelon and others drawn from industry, communities, labour and universities, will soon be touring the province, including a meeting in Nanaimo tentatively scheduled on April 18, to examine what needs fixing in the troubled industry.

Arnie Bercov, vice-president of Pulp, Paper and Woodworkers of Canada Local 8, representing Harmac pulp mill workers, has been raising red flags over the declining forest industry for years.

He's critical of the premier's roundtable, but acknowledges that something must be done to reinvigorate the troubled industry.

"I think a long-term view of the industry is required and I wonder if the roundtable's participants have taken the time and effort to put together a comprehensive inventory of the province's forest assets, and are they using the best science available to develop plans to deal with issues that will have serious implications for the future of the industry, like the pine beetle infestation and global warming?" he asked.

"There's no doubt that something needs to be done but I don't believe it's too late because the trees are not going anywhere; unless the government allows raw log exports to continue."

The United Steelworkers, which represents hundreds of forestry workers in Nanaimo, including Madill's skilled labourers, are also demanding the government take "immediate steps to stop the bleeding in British Columbia's forest industry" and offered some ideas of their own.

Last week, the union released a 10-point plan aimed at getting the industry back on its feet.

"We need action right now," said spokesman Bob Matters. "Forest-sector workers, our families and our communities cannot wait."

Matters noted that laid-off Steelworkers recently lobbied the B.C. government for action on the growing crisis.

However, he said almost all of the government MLAs either denied there is a crisis, blamed all the industry's problems on economic conditions, suggested workers wait until the results of premier's roundtable, or said they have no answers.

"They seem not to have very many of their own ideas, so we're happy to provide them with several," he said.

"Steelworkers challenge them to adopt them so we can start rebuilding the province's most important industry."

The Steelworkers' proposals include measures to cut log exports and encourage more wood manufacturing in B.C.; reductions in the quantity of usable logs left to rot in the province's forests; inducements to purchase new logging and sawmill equipment; programs for worker training and skills upgrading and better enforcement of safety standards in an industry where more than 20 workers are killed on the job and more than 90 severely injured annually.

"These are our solutions. No one in government or industry seems to have any ideas," said Matters.

Ron Cantelon said Madill's demise is the latest proof that the industry is in bad shape and "everything will be on the table" when the roundtable holds its meetings in 18 communities over the next six weeks.

"We intend to begin these discussions from ground-zero and we're looking at compiling a list of about 20 questions that we'll be seeking answers to; such as what do we want the future industry to look like, what changes are needed and how can we attract investment into the industry," he said.

"There's no doubt the industry is in trouble and we need to completely reconfigure it. One way would be to determine what the market demands are and work backwards from there instead of following the old practices of cutting as much lumber as we can and worry about selling it afterwards."

Leonard Krog, Nanaimo's NDP MLA, is skeptical of the Liberals' forest policies and places the blame for Madill's closure squarely on the government's shoulders.

"Madill was one of the oldest manufacturers of forest equipment in Canada," said Krog.

"They survived downturns in the industry before, under governments of all stripes. But they couldn't survive the B.C. Liberal-created forest crisis. What will it take before this government takes some action to help forestry in B.C.?"

Krog pointed out that NDP Leader Carole James released a five-point plan in January to renew and modernize the forest industry.

The plan includes developing a green forest plan, developing an innovative and diverse industry, community and worker stabilization funding, a permanent commission on forestry and tenure reform.

"By contrast, the only thing to come from the B.C. Liberals has been a roundtable," Krog said.