The market has been slowly recovering since 2009, as U.S. total housing starts recorded a steeper decline, falling 69.2% from 2006 to 554,000 units in 2009, the lowest level since 1959. However, in 2020, both were still below pre-financial crisis levels. From 2009 to their latest peaks in 2017, softwood lumber production and new housing in Canada both trended upward. In 2009, housing starts in Canada were at their lowest since 1999 (149,081 units). in 2009, a 11 percentage-point reduction from 2007.ĭemand for Canadian softwood lumber was significantly impacted in 2008-2009 due to sharp declines in Canadian and U.S. The impact was more severe for sawmills, with revenue from goods manufactured falling 40.3% (-$4.6 billion) over the same period.Ĭanada exported 44% of the total quantity of softwood lumber it produced to the U.S. Most manufacturing industries were adversely impacted by the financial crisis in 2008/2009, with total revenue from goods manufactured in Canada falling 17.8% (-$106.6 billion) from 2007 to 2009. Exports of softwood lumber accounted for 14% of British Columbia's total domestic merchandise exports in 2020. However, this represents a drop from 16% in 2006. While sawmills (except shingle and shake mills) manufacturing is important to themany provinces' economies, it was the largest manufacturing industry in British Columbia in 2020, with a 12% share of the province's total revenue from goods manufactured. Since 2006, Alberta gained 8 percentage points of the Canadian market, while British Columbia lost 13 percentage points. When comparing 2020 with 2006, the average Canadian weekly earnings for the sawmill and wood preservation industry increased 44.4% to about $1,241, compared with a 27.7% increase seen for the manufacturing sector as a whole.īritish Columbia, Quebec and Alberta produced 81% of Canada's softwood lumber in 2020. In 2020, over three-quarters of sawmill and wood preservation industry workers were employed in British Columbia, Quebec and Alberta. Most likely driven by a modernization shift that impacted infrastructure, equipment and production processes, employment was down 41.0% (or 22,330 employees) compared with 2006, while employee productivity improved 17.2% over the same period. In 2020, the sawmill and wood preservation industry employed an annual average of 32,124 workers. In 2020, the wood product industry contributed 6% to revenue from goods manufactured of a value of $635.1 billion. Revenue from goods manufactured in the wood product industry contributed 5% to total revenue from goods manufactured in 2006, of which sawmill and wood preservation represented about half. In 2020, the COVID -19 pandemic exacerbated market conditions with excess demand, resulting in skyrocketing lumber prices. These challenges combined with the high cost of logs, pulpwood and other forestry products in recent years have led to a number of mills curtailing production in 2019, with some closing indefinitely. on Canadian lumber imports, ongoing fibre supply challenges in western Canada due to wildfires, damage caused by mountain pine beetle, changes to land use regulations, as well as rail car availability issues. The forestry sector has had its share of challenges that have impacted the demand for lumber and the supply chain: the financial crisis in 2008/2009, trade conditions imposed by the U.S. Significant changes in the economic state of either country as well as in trade policy can affect the viability of the Canadian sawmill industry. housing markets to stimulate production and capital investment. Therefore, Canadian sawmills rely on growth in both the domestic and the U.S. In 2020, 67% of Canada's softwood lumber production was exported, 84% of which was to the U.S.ĭimension softwood lumber is the main material used in home construction, whether it be for the framing and roofing of new housing or for rebuilding and renovating existing homes. Softwood lumber represented 98% of all lumber production in 2020.Īs one of the world's largest producers and exporters of softwood lumber, demand for Canadian lumber is largely driven by U.S. The sawmill industry produces softwood and hardwood lumber, as well as various by-products, such as wood chips and sawdust, that are used as inputs in other industries. The purpose of this research paper is to highlight the impact of the many challenges faced over time by the sawmill industry on its development and its role as an economic lever for many Canadian communities. Text - Selected Related information PDF (239 KB)
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