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EXEC LEADERSHIP: MARKETS AND FIBRE TO DOMINATE AGENDA


April 1, 2001
By Pulp & Paper Canada

VANCOUVER, BC — Two subjects will rule the agenda of Canadian forest-products companies for the next few years, said senior forest industry executives at PricewaterhouseCoopers’ annual global forestr…

VANCOUVER, BC — Two subjects will rule the agenda of Canadian forest-products companies for the next few years, said senior forest industry executives at PricewaterhouseCoopers’ annual global forestry industry conference in March.

On the top of the list is access to American markets, which might be hampered with the ending of the Canada-US Softwood Lumber Agreement (SLA) on March 31. American producers are lobbying to continue to impose trade restrictions on Canadian lumber shipments, which they say are unfairly subsidized. American consumers, however, would see increases of $1000 tacked on to the price of each new house, if such market restrictions were imposed. A growing number of American political leaders have taken up this cause, and have called for an end to the SLA without introduction of other trade sanctions.

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Canadian producers have another card at their disposal, said Tom Stephens, former president and CEO of MacMillan Bloedel (which was bought by Weyerhaeuser), and now an independent director of a number of companies. Stephens urged the Canadian industry to take a firm stand, particularly since Americans face energy shortages that Canadian energy producers can alleviate. “Canada has its hand on the American light switch,” he said, recommending that trade discussions on softwood lumber be clearly linked to that of energy.

An equally important question is access to fibre. Environmental groups are putting increasing pressure on producers, notably those operating on BC’s Central Coast, to limit or change forest practices. Yet producers should not easily yield to such pressures, said Russ Horner, president and CEO of Norske Skog Canada. “It’s important for the industry to distinguish between environmental groups that are prepared to sit down and work constructively towards solutions, and those that are only interested in sustaining the conflict in perpetuity.”


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