Office of the Premier

Forest policy reforms to rebuild coastal forest sector

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Office of the Premier

Forest policy reforms to rebuild coastal forest sector

Media Contacts
Jen Holmwood
Deputy Communications Director
Office of the Premier
250 818-4881
Vivian Thomas
Communications Director
Ministry of Forests, Lands,
Natural Resource Operations
and Rural Development
778 974-5809
(flickr.com)
Media Contacts
Jen Holmwood
Deputy Communications Director
Office of the Premier
250 818-4881
Vivian Thomas
Communications Director
Ministry of Forests, Lands,
Natural Resource Operations
and Rural Development
778 974-5809

Backgrounders

More domestic processing of logs and fibre

As part of Coast Forest Sector Revitalization, the government is rebuilding the solid wood and secondary industries by ensuring more logs and fibre are processed in B.C.

Manufactured Forest Products Regulation

This regulation, introduced in 2003, defines the criteria that products must meet to be considered manufactured under the Forest Act. However, too much minimally processed lumber is being exported and further manufactured in other jurisdictions. An example is lumber that is being exported to be dried and planed. The Province will be amending the regulation this spring to increase the opportunities for manufacturing in B.C.

Log exports – surplus test

The Forest Act, since it was introduced in 1912, has required the domestic manufacture of timber, but has included provisions for exemptions from that requirement. An exemption for logs can be obtained either through an order-in-council (OIC) or a ministerial order. The vast majority of logs are exported through the “surplus test” where potential exporters must first advertise the logs for domestic use. If there is no domestic buyer, then those logs are provided an exemption. Should a domestic buyer put an offer on these logs, the Minister’s Timber Export Advisory Committee will determine if the offers reflect fair domestic market value and provide recommendations to the minister on each application regarding whether an exemption should be provided.

As part of the Coast Forest Sector Revitalization Initiative, the ministry will be revising the membership and terms of reference of the Timber Export Advisory Committee to include broader First Nations’ membership and to strengthen the review process.

Orders-in-council for exports of standing timber

Section 127 of the Forest Act allows exemptions from the manufacturing requirement. OICs can be established to allow a percentage of harvest from each licence within a geographic area to be exported without having to offer the logs to the domestic industry first. These OICs are in areas where there are few or no domestic manufacturing facilities and otherwise would be uneconomic to harvest. The following log export OICs are in effect throughout the province:

  • Haida Gwaii – First came into effect in 1986, terminated in 1992, brought back into effect July 29, 2010, and expires July 31, 2019. It allows 35% of logs harvested by tenure to be exported (except cedar and cypress).
  • Northwest Interior – Continuous since 2002 and expires July 31, 2019. It allows 20% of logs harvested by tenure to be exported (except cedar and cypress).
  • North Coast district – Continuous since 2002, and expires July 31, 2019. It allows 20% of logs harvested by tenure to be exported (except cedar and cypress).
  • Mid-Coast area – First came into effect in 1986, terminated in 1992, brought back in 2006, and expires July 31, 2019. It allows 35% of logs harvested by tenure to be exported (except cedar and cypress).
  • Nass Timber Supply Area – First came into effect in 1985, and expires on July 31, 2019. It allows 100% of logs harvested to be exported.

As part of the Coast Forest Sector Revitalization Initiative, the ministry is engaging and consulting with First Nations and industry on new economic criteria to be used in developing OICs for areas that require limited log exports to support harvesting operations.

Fee-in-lieu

A “fee-in-lieu of manufacturing” is charged to log exporters. The fee is based on the species of log and its quality. A new fee structure based on harvest economics is being developed, which will come into effect summer 2019.

Other changes to log export policy include the need for log suppliers in the Northwest Interior to advertise logs for sale close to the harvested area to improve access for manufacturers; and changing the freight adjustment for the west coast of Vancouver Island.

Media Contacts
Vivian Thomas
Communications Director
Ministry of Forests, Lands,
Natural Resource Operations
and Rural Development
778 974-5809
Reducing wood waste and making more fibre available

Some level of residual fibre being left in harvest areas is an inevitable byproduct of timber harvesting operations and can be beneficial to meet wildlife or environmental objectives. However, some fibre is left in harvest areas because it is costly to remove and/or has limited economic value to the primary tenure holder. This latter category is referred to as “avoidable” waste fibre.

Prior to 2003, avoidable waste fibre on the coast was less than 5% of the harvest volume at approximately 0.8 million cubic metres or less per year. By 2017, the waste increased to more than 16% of harvest volume at approximately two million cubic metres per year and, in some cutblocks, wasted fibre volumes are greater than the timber volume harvested.

The Coast Forest Sector Revitalization Initiative includes measures to enable greater harvest of the allowable annual cut, and a reduction in the amount of avoidable waste fibre by directing it to manufacturers, such as pulp and paper mills, that can use the fibre.

To reduce avoidable waste fibre, encourage better business-to-business relationships and increase fibre access to a broader range of manufacturers, a fibre recovery zone is being created in areas of Vancouver Island and the south coast where enhanced fibre recovery is economical. In this geographic area, significant penalties will be applied for any avoidable waste fibre left in harvest areas that exceeds the new lower waste benchmarks that are being introduced. The new benchmarks take into account fibre intentionally left for ecological or wildlife values.

To complement these changes, a new policy for scaling and pricing secondary products will be introduced to reduce the regulatory burden, allowing the removal of primary and residual fibre concurrently from harvest sites. The new procedure will help move more fibre to market instead of being left in harvest areas.

Additionally, as of April 1, 2019, the post-harvest appraisal reconciliation model, or PHARM, already in use in the Interior, will apply to cutting permits issued on the coast. Rather than the current system in place on the coast that uses pre-harvest estimates to determine stumpage rates, the PHARM model uses post-harvest information to capture the true cost of development and stumpage on actual timber harvested.

As well, to reduce specific targeting of cedar in hard-to-reach areas, the stumpage cost allowance for helicopter single-stem harvesting has been removed. This will encourage licensees to harvest either the whole cutblock or leave cedar stems for ecological, wildlife and visual quality.

Media Contacts
Vivian Thomas
Communications Director
Ministry of Forests, Lands,
Natural Resource Operations
and Rural Development
778 974-5809

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