Did Trump Kill the BC Forest Industry? A systems level analysis of BC forestry
- Shannon Peel
- 5 days ago
- 48 min read
Updated: 50 minutes ago
by Shannon Peel, MarketAPeel
I grew up in British Columbia. My dad was a logging truck driver. The forest industry paid for my childhood, and for the childhoods of a lot of kids in this province. The recent mill closures have a real impact on families and small towns in this Province. The problem is the media and politicians are pointing at Trump's tariffs as the villain and shrugging their shoulders.
The BC forestry industry is under pressure from decades of compounding damage. It's time we understood the larger problem to see if this industry can be saved. The decline of BC forestry is not caused by one politician or one tariff. It’s the result of rising operating costs, BC Government policy and regulation, lower exports to China, wood supply, investment leaving, housing slowdowns, mill closures, environmental constraints, global competition, and long-running Canada–US lumber disputes.
The real problem in BC forestry isn’t tariffs alone, it’s that the industry was built for a global economic environment that no longer exists and the companies who cut the timber abandoned the communities that supported them to go to the USA.
The Tariff Situation: What Are The Numbers?
The numbers have moved a lot and there is genuine confusion about where the tariff numbers stand. As of October 2025, the tariff on softwood lumber was 45%. But the big forestry companies had already pulled up stakes before Trump 2.0. By the time Trump increased the tariffs to unsustainable amounts, the BC forestry industry was already dying.
Canadian softwood lumber has never truly benefited from free trade, like CUSMA, with the United States. What's called the "lumber wars," the ongoing dispute over US allegations that Canadian provinces subsidize logging companies by charging below-market stumpage fees for Crown land timber, has been running since the 1980s. The latest chapter began after the expiration of the 2006 Softwood Lumber Agreement, when the US began reimposing anti-dumping and countervailing duties.
By 2025, the combined anti-dumping and countervailing duty rate on Canadian softwood lumber had been set at approximately 35.2%, more than double the 14.54% rate in place at the start of the year. Then in August 2025, Trump used the International Emergency Economic Powers Act to increase tariffs further. In September, he added another 10% global tariff on softwood timber and lumber under Section 232, a national security statute, on top of the existing duties.
By October 14, 2025, Canadian softwood lumber was facing combined US import taxes exceeding 45%.
Canada's forestry sector directly employs roughly 194,000 Canadians and contributed $23 billion, approximately 1% of nominal industry GDP, to the Canadian economy in 2024, according to RBC Economics. The tariffs are not trivial. They have pushed many Canadian sawmills into negative margins and one of the reasons for the recent mill closures.
Why was the BC Forestry Industry on Its Last Legs?
Here is what most coverage misses: the tariffs arrived on top of a structural crisis that had been building for three decades.
The mountain pine beetle. Starting in the late 1990s, a warming climate triggered an explosion in the mountain pine beetle population across BC's interior forests. By 2015, the provincial forest ministry estimated that 731 million cubic metres of merchantable timber had been killed in the epidemic, what one analyst called Canada's worst natural habitat disaster. The BC provincial government decided to salvage what they could from the desaster by boosting the annual allowable cut to 86 million cubic metres. At peak, 111 sawmills were running full-tilt to process the supply of pine beetle killed trees, but once it was used up, the industry faced a severe fibre shortage.
The allowable annual cut has since fallen to 62 million cubic metres in 2023 fr 86 cubic metres, and nearly half the sawmills operating in 2005 have closed.
Jobs and GDP: the long decline. In the early 2000s, logging and wood manufacturing made up about 5% of BC's GDP and employed 90,000 people. As of the mid-2020s, forestry employed fewer than 50,000 and accounted for roughly 2% of provincial GDP. Employment in sawmills and wood preservation fell roughly 20% between 2017 and late 2025 nationally, with BC seeing a 32% decline. Industrial capacity utilization for wood product manufacturing has dropped about 10 percentage points to 75% in 2025 from a decade earlier.
BC forestry advisor Alice Palmer has described the situation as a "triple whammy:" depressed US and China markets, US tariffs, and a fibre supply crisis. The industry is not facing a single problem. It is facing the compounding of multiple crises over decades, with increased tariffs being the most recent issue.
Government Policy and the Big 5: The BC Government under Gordon Campbell changed the rules and gave the big forestry companies more freedom to sell the raw logs wherever they wanted instead of having to build and maintain mills in BCs rural communities. These companies took full advantage. More on this part of the story below.
Investment going to the US from BC: The big companies making money on our forests didn't just close down mills in BC to save money. They took that money and opened up mills in the southern USA. They claim it's because the trees there grow faster and tariffs made it too expensive for them in BC. More on this further down.
And then there are the wildfires... This needs it's own section, it's own post, because the reason fires are bigger in BC has more to do with the change in wildfire management than it does in climate change.
How Did BC's Wildfire Policy Shifts Make Fires Bigger?
Wildfires. The warming climate has also delivered increasingly severe wildfire seasons. By mid-August 2025, an estimated 7.3 million hectares had been burned — the second worst fire season on record after 2023's record. Wildfires do not consume trees the way most people imagine — the living part of the tree boils rather than burns, leaving standing dead timber that has to be salvaged before it deteriorates. That means ongoing salvage operations and replanting, but it also means reduced accessible fibre supply.
The Wildfire Policy Shift Nobody Talked About — Until the Fires Got Too Big to Ignore
Here is something most Canadians do not know: the size of BC's wildfires is not just a climate story. It is also a policy story and the policy decisions go back decades.
For most of the 20th century, BC operated under a philosophy of total fire suppression. Every fire, everywhere, as fast as possible. Growing up the ads telling you to call a hotline number as soon as you saw smoke started in May and went all summer. After every summer lightening storm, you'd see the planes and helicopters flying over to any areas with smoke.
The agency responsible was even called the Protection Branch of the Ministry of Forests, the name itself tells you the worldview. Fight every fire. Control every flame. Protect the timber.
But then things changed and suddenly the fires were larger. In 1998, right after my wedding, there was a huge fire that threatened to burn down Salmon Arm. Then came the big fire in West Kelowna in 2003 that burned through neighbourhoods. Every year since then has had major fires and that was due to changing the way the world fought them.
The philosophy started shifting in the 1970s and 1980s, when research began establishing that fire is a natural and essential ecological process in BC's forests, not an enemy to be eliminated but a cycle to be managed. The BC Ministry of Forests, in partnership with the Canadian Forest Service, developed computer-assisted decision-making for "whether or not to let a wildfire burn" based on fire behavior and the values at risk. This strategy became known as "modified response" or "managed fire," and it is the policy framework BC still uses today.
The BC Wildfire Service currently operates with three official response types:
Full response — when there is a threat to public safety, property, infrastructure, or timber. Immediate suppression, fire fought until declared "out."
Modified response — when there is no immediate threat to values. The fire is managed using a combination of techniques with the goal of minimizing damage while maximizing ecological benefits. The fire is steered and contained within a predetermined perimeter rather than extinguished.
Monitored — the fire is observed and analyzed but not immediately suppressed. Used on remote fires that do not threaten values, and allowed to burn for ecological or resource management objectives.
BC's own government acknowledges decades of aggressive fire suppression resulted in unnatural fuel buildup, increased wildfire risk, and decreased forest resilience. The PR team was pushing the new let it burn philosophy to the masses. The Globe and Mail reported, "An unintended consequence of suppression has been to increase forest densities and fuel loads in the dry forests of British Columbia, making them more susceptible to severe fire that is difficult to control — a phenomenon known as the fire-suppression paradox."
A 2024 study published in Nature Communications made this point with research data: by suppressing smaller, lower-intensity fires, fire management agencies inadvertently eliminated the fires that would have cleared fuel loads, leaving only the most extreme fire conditions to create ignition events. "The result is akin to the over-prescription of antibiotics: in our attempt to eliminate all fires, we have only eliminated the less intense fires and instead selected for primarily the most extreme events."
In BC, the province's own factsheet on prescribed burns acknowledges the consequence directly: "wildfire seasons have been starting earlier and lasting longer as a result of pronounced droughts, climate change and increased forest fuel accumulation due to fire suppression activities."
So the logic of modified response is defensible. But here is the problem: the policy shift toward managed fire happened at the same time as something else, a significant reduction in the provincial firefighting capacity available to respond when managed fires escaped their containment lines.
What Did Job Cuts do to Wildfire Fighting in BC?
The federal Canadian Forest Service, the national body that supports fire research and firefighting capacity, saw its staff shrink from approximately 2,200 in the 1990s to around 700, following the deep federal austerity programs of that era. That is a roughly 68% reduction in federal forestry capacity over roughly a decade.
Today, the BC Wildfire Service employs approximately 1,300 firefighters each season, plus contractors, with around 400 initial attack firefighters stationed across the province who can be relocated based on provincial need. Due to the quick response of initial attack crews, approximately 94% of all new wildfires in BC are suppressed at the initial attack stage. That statistic sounds reassuring until you consider what it means in the inverse: 6% of fires escape initial attack. And it is those escaped fires, the ones that grow beyond small crew suppression capacity, that become the disasters.
The 2003 Firestorm season in BC was a disaster where more than 2,500 wildfires burned, destroyed 334 homes, forced the evacuation of over 45,000 people, and cost the province approximately $700 million, triggered the landmark Filmon Review, led by former Manitoba Premier Gary Filmon. His review identified the buildup of forest fuels through years of fire suppression and the growing urban-forest interface as two of the central factors in the crisis. He made dozens of recommendations about resources, staffing, prevention, and community preparation.
Was Filmon's Explanation the Whole Story about the Firestorm?
The 2003 Okanagan Mountain Park fire started at 4 a.m. on August 16 via a lightning strike near Rattlesnake Island, a remote, rugged area accessible only by helicopter, boat, or foot. The BC Wildfire Service was notified within the hour. By midday on August 16, the same day it started, ground crews with hand tools and helicopters for water drops were already on it, with the fire estimated at just one to two hectares.
This was not a "let it burn" modified response decision. They attacked it immediately.
The 2003 firestorm was not caused by the modified response policy. Initial attack was launched the same morning the fire started, and it failed not because of a decision to let it burn, but because the terrain was genuinely brutal and the conditions, the driest summer on record to that point, 44 consecutive days without rain in the Kelowna area, pushed the fire beyond what initial attack capacity could handle.
But the reason it became a catastrophe rather than a serious but contained fire comes back to three compounding factors that the Filmon framing of "fuel load and interface" quietly absorbs without fully naming:
First, the suppression paradox over seven decades. Every small fire successfully extinguished in the Okanagan from the 1930s onward added to the fuel load that made the 2003 fire unstoppable. The policy of total suppression created the conditions it was designed to prevent. This is the part Filmon did identify.
Second, reduced provincial capacity in the years immediately before 2003. When initial attack failed and the fire needed escalation, the resources to escalate quickly were stretched thin across a province simultaneously fighting hundreds of other fires. Budget cuts in the preceding years meant there was less capacity in reserve for exactly the scenario that materialized.
Third, the scale of the 2003 season itself This was not one hard fire. It was 2,500 fires burning simultaneously across drought-stricken BC, 218 new starts in a single day, every resource in the system committed. Under those conditions, even a well-resourced, well-staffed fire service would have been overwhelmed. The question of whether adequate resourcing would have made a decisive difference to the Okanagan Mountain Park fire specifically, given the terrain, the drought, and the winds, is genuinely unknowable.
What is knowable is that the Filmon Review focused the conversation on fuel management and interface planning, both legitimate and necessary, in a way that made the budget cuts and staffing reductions of the preceding years less visible in the public narrative.
The Wildfire Resource Sharing System
When BC fires exceed the capacity of provincial resources, the province draws on the Canadian Interagency Forest Fire Centre (CIFFC), founded in 1982 specifically to coordinate mutual aid between provinces and internationally. The formal mechanism is the Canadian Interagency Mutual Aid Resources Sharing (MARS) Agreement, established in 1983, which allows provinces to share firefighters, equipment, and aircraft. International agreements exist with the US, Australia, New Zealand, Mexico, and South Africa.
This system works — when it is not everyone's bad season simultaneously.
The problem is that as climate change has driven more severe fire conditions across broader geographies and longer seasons, the mutual aid system is increasingly being called upon in years when every jurisdiction is already stretched. During the catastrophic 2021 BC fire season, the province imported approximately 917 people and still had to export 248 to help other jurisdictions, all during a global pandemic. In 2023, more than 1,100 firefighters from around the world were dispatched across Canada in a single season. In June 2025, the US mobilized federal firefighting personnel to support BC, Manitoba, Saskatchewan, and Alberta simultaneously.
The mutual aid system is not a substitute for baseline capacity. It is a supplementary layer for peak events. When the peak becomes the norm, which is increasingly what BC's fire seasons look like, the system reveals its structural limits. Resources must be requested, approved, and transported. Fires do not wait.
What Does All This Means for BC's Forest Industry?
The modified response policy, applied to fires in remote areas without immediate threat to values, allows fires to burn longer before suppression resources are committed. In drought-dry forests loaded with beetle-killed timber, standing dead wood from past fires, and decades of accumulated fuel, fires that are "monitored" rather than immediately attacked can escalate rapidly in changing wind or weather conditions. When they do, they burn through the accessible, commercially valuable timber that BC's sawmills depend on.
The BC government's own research acknowledges that BC's allowable annual cut has fallen by one-third over the past 20 years due to insect infestations, wildfire losses, and land set asides, with harvest levels dropping by approximately half. Wildfires are a significant contributor to that supply reduction. A forest burned in a severe fire is not necessarily lost forever, but it takes decades to regenerate to commercial viability, and salvage operations must move quickly before beetle infestation or rot renders the standing dead wood unprocessable.
The forestry industry's fibre supply crisis and the wildfire management policy shift are not unrelated phenomena. They are two threads of the same story: a landscape that was managed intensively for timber production for most of the 20th century, then managed more ecologically from the 1980s onward without a corresponding increase in the prescribed fire and fuel management capacity needed to safely execute that transition, and without enough provincial firefighting capacity to respond effectively when fires escaped.
The 2022 BC budget committed $243 million over three years to expand the BC Wildfire Service to year-round operation, a recognition, after four major fire seasons in five years, that the seasonal firefighting model was structurally inadequate. But that investment is recent, and the accumulated fuel loads, the depleted fibre supply, and the structural changes in BC's forest landscape are the product of decades, not years.
The increase in size of wildfires and the smoke they create are not soley due to climate change, but rather to letting fires burn large swaths of forests during a drought.
Why Does BC Ship Raw Logs to the US?
The short answer is that BC used to have a law that prevented this, and the BC Liberal government under Gordon Campbell removed it in 2003 and 4 Premiers since then have enabled Canadian jobs in the forest industry mills to be lost.
Gordon Campbell (BC Liberal) 2001–2011 — Removed appurtenancy, tripled raw log exports, cut forest protection budget 32%, eliminated 35% of firefighting jobs. The 2003 Firestorm happened on his watch, as did the Filmon Review he commissioned.
Christy Clark (BC Liberal) 2011–2017 — Continued the same general direction. Raw log exports hit record levels under her government.
John Horgan (BC NDP) 2017–2022 — Repeatedly promised to address raw log exports and raw log processing. Made some moves but never reinstated appurtenancy. The 2021 wildfire season, the worst in BC history happened on his watch.
David Eby (BC NDP) 2022–present — Has signalled intent to restore some version of appurtenancy requirements, but the structural damage from 20 years of deregulation has not been undone.
BCs Premiers are the villains in the BC Forestry story not the protectors they are meant to be. One sentence in one piece of legislation changed the economic trajectory of dozens of BC communities leaving everyone who grew up in a forestry community asking, why are we sending our trees to American and Asian mills instead of cutting them here and keeping the jobs?
Canadian forestry companies have been dependent on the US market
The numbers are stark. As of 2025, export volumes to regions beyond the US are at historic lows, just 13% of total Canadian lumber exports, compared to an average of roughly 20% over the previous 20 years. Almost 90% of the lumber produced in BC is exported, and the US has consistently absorbed about 75% of what Canada cuts. Vancouver-based forestry analyst Russ Taylor put it plainly: "We're never going to diversify our way out of the US. The history, the proximity, the product qualities and their sheer demand, the economics just don't allow for that. But finding ways to lessen our reliance on them, that's what this will do."
The good news, and there is genuine good news here, is that markets exist. Japan is currently Canada's top strategic target for lumber diversification, and it is a smart one. Japan's construction sector is shifting from single-family homes toward multi-storey timber buildings, and Canada Wood Group president Bruce St. John points out that "Japan gives the highest possible return to the industry in terms of the value of the lumber they import. They import our traditional products, and we make products that are specific to their market." BC has had a 50-year relationship with Japan through the BC Council of Forest Industries, that relationship is an asset most Canadians have never heard of.
India, the Middle East, the UK, and North Africa are being actively developed as new markets. None of them will replace the US in the near term, but each percentage point of diversification reduces the industry's existential dependence on an American political system that has repeatedly used lumber tariffs as a negotiating tool regardless of which party is in power.
The Opportunity for Forestry is Domestic
The federal $500 million in market and product development funding is specifically intended to help companies build finishing capacity here. Prefabricated homes, mass timber structures, wood-fibre insulation, these are growth segments in domestic and international construction.
The question is whether the industry will actually use this moment to invest in them, or wait for US tariffs to ease and fall back into old habits.
The problem is we don't protect our mills. Canada keeps shipping raw logs to the US so American mills can process them, add value, and export the finished product. Canada loses the jobs, the value-add, and the economic multiplier at every stage of that process. Remember that earlier statistic about half the mills closing? Why are they closing?
What was Appurtenancy and Why Did It Matter?
For most of BC's modern forestry history, companies that were granted logging rights on Crown land operated under what was called an appurtenancy clause. The principle was straightforward: if you want the right to harvest BC's public timber, you must process that timber in a BC mill. The logging rights and the milling obligation were tied together. Communities that hosted the logging got the jobs that came from processing the logs.
This was not charity. It was the social contract that justified giving private companies access to publicly owned resources. The Social Credit government originally put appurtenancy in place to induce capital investment in communities and allow timber-processing efficiencies to develop. It worked, BC's network of interior and coastal mills, the jobs in those mills, and the communities built around them were the direct product of that system.
In 2003, the BC Liberal government under Gordon Campbell passed the Forest Revitalization Act. With what one commentator described as "a one-sentence change," appurtenancy was eliminated. Companies that held logging rights on Crown land no longer had to process those logs in BC. They could close their mills, hold onto their timber rights, and export the raw logs, or sell the tenure to someone who would do the same.
The consequences were immediate and they compounded over two decades.
What Happened to BC Forestry After 2003?
Between 2002 and 2012, over 47 million cubic metres of raw logs were exported from BC to foreign mills in China, the US, Japan, Korea, and other nations, compared to about 14.8 million cubic metres in the preceding decade under the NDP government. That is more than three times the volume.
The mechanism that enabled this was a "surplus test" that still exists today: companies wishing to export logs must first offer them to domestic buyers. If no domestic buyer makes a fair offer, the logs are deemed "surplus" to domestic needs and can be exported. But as the Canadian Centre for Policy Alternatives pointed out, this became a self-fulfilling prophecy. Fewer domestic mills meant more logs cleared the surplus test. More raw log exports meant less economic justification for building new mills. Each mill closure made the next one more likely.
On BC's coast, 40% of the timber harvest was being exported as raw logs even while mills in the Lower Mainland were reporting they could not get adequate wood supply.
Companies were simultaneously logging their tenured areas and exporting the unprocessed logs, holding the Crown rights to the timber, taking the revenue from selling unprocessed logs, and providing none of the processing jobs that the original social contract had been designed to secure.
The Canadian Centre for Policy Alternatives estimated that the cost of not turning those logs into lumber in BC was the loss of an estimated 5,872 jobs in 2005 and 5,756 jobs in 2006 alone, from raw log exports off the coast.
The 30,000 forestry jobs lost in BC since 2001 that NDP leader John Horgan cited in 2017 are not simply the result of pine beetles and wildfires. They are substantially the result of a policy decision to remove the obligation to process BC wood in BC.
What's the Difference Between Ontario and BC?
The data on what raw log exports actually cost in jobs versus value-added processing is clear and it has been consistent for decades.
To create one full-time year-round job in Ontario's forestry sector, Ontario needs to harvest approximately 292 cubic metres of wood, roughly seven to eight logging trucks. In BC, one full-time year-round job requires 1,312 cubic metres, about 33 logging trucks. Each cubic metre provides Ontario's economy with approximately $839 in value. In BC, each cubic metre averages $233.
That gap is not primarily explained by tree species or terrain. It is largely explained by how much processing happens in each province before the wood leaves. Ontario's forestry sector processes more of what it cuts. BC exports more of what it cuts without processing. Almost 97% of all Canadian raw log exports come from BC, the amount shipped by any other province is negligible.
The Complications in BC Forestry Are Real
Industry defenders of raw log exports make two arguments worth engaging honestly.
The first is that some species and grades of wood do not match existing BC mill configurations, particularly second-growth wood that older coastal mills were not built to handle, and that exporting these logs is better than leaving the timber unharvested. This is true as far as it goes. After decades of logging the large, easily processed old-growth from lower elevations, BC is left with smaller second-growth trees and different species that require different mill technology. The industry did not invest in that technology during the years when it should have, in part because removing appurtenancy meant it no longer had to.
The second argument is that raw log exports have already fallen substantially, down 54% between 2017 and 2024, so the issue is less significant than it once was. This is accurate, but it obscures the structural damage already done. The mills that closed during the peak export years did not reopen when exports declined. The communities that lost their economic anchors did not recover. The investment in processing capacity that did not happen between 2003 and 2017 represents lost economic development that is very difficult to recapture.
How Did Tariffs Increase Raw Log Exports?
One reason the US has been able to sustain the argument that Canadian lumber is unfairly subsidized is that Canadian companies harvest timber from Crown land at stumpage fees set by government rather than competitive market auction. Exporting raw logs from those Crown lands, logs that are not subject to softwood lumber tariffs the way finished lumber is, creates a perverse incentive structure: companies can avoid the tariff burden on lumber by exporting unprocessed logs, and then the lumber the US produces from those Canadian logs enters the market without the tariff.
The BC government actually negotiated raw logs out of the 2006 Softwood Lumber Agreement coverage. The CCPA noted at the time that this created a further incentive to export raw logs because finished lumber products carried export taxes of up to 15% under certain thresholds of the agreement, but raw logs faced no such penalty. If you were an executive trying to maximize shareholder return and minimize tariff exposure, the policy framework was telling you to export logs unprocessed.
Both the policy change and the removal of raw logs from the tariffs benefited the US far more than it did Canada. It was a bad policy decision and the forestry industry may never recover. This is on the heads of the premiers that have allowed it to continue for the benefit of the US.
Did Exporting Raw Logs Increase Jobs in the Bush?
Yes, at first but when the old growth supply ran out, the big companies left. The fallers, the buckers, the skidder operators, the feller buncher crews, and the logging truck drivers. The people who are not in the mill, they are in the bush, on the landing, on the highway at 4 a.m. with a load of logs. The people whose livelihoods depend not on whether the mill runs but on whether there is volume to cut. There jobs are now disappearing as investment leaves BC and goes to opening mills in southern US states.
My dad was one of them. I grew up in that world. My dad would get up at 2am and drive up to the landing to get his first haul of logs to take to the mills. He'd get home at 7 or 8 PM, just enough time to eat dinner, watch a bit of TV and then go to bed because 2am comes early. In 1991 the company he worked for shut down and he had to find a different career. He landed in a union 9-5 city job and enjoyed semi-retirement. But most are not that lucky. Lots of the guys who worked up on the landing ended up injured, disabled, or dead. It is dangerous work that takes it's toll on your body making it harder to pivot into a different career.
The story of what happened to those jobs after Gordon Campbell removed appurtenancy in 2003 is not the story most people tell, because the damage took longer to show up, and when it arrived, it looked like a natural decline rather than a policy consequence. It's this group that benefited from the removal of the appurtenancy at first. So when their jobs went away, the mills were seen as the victims and the logging companies the reason.
The logging companies did benefit from raw log exports, which led to the mills closing down and the industry cannibalizing itself. Taking a closer look at this group within the forestry industry will help us to understand the problem better and why the whole industry is now collapsing... and it isn't tariffs.
Why In-the-Cut Jobs Did Not Disappear Immediately
This is the critical detail that made the appurtenancy removal politically survivable in 2003, and obscured its long-term cost.
When Campbell's Forest Revitalization Act severed the link between logging rights and milling obligations, companies could close mills without stopping harvesting. And for a period, they did exactly that. The trucks kept running. The skidders kept moving. The fallers kept cutting. The logs just went to the port instead of the mill down the road.
Industry analyst David Elstone has documented that it takes more than 100 distinct job functions to sustainably plan, harvest and deliver timber from forest to primary manufacturing, spanning planners, engineers, environmental professionals, equipment operators, truckers, port workers and the local service businesses that support them. All of those upstream jobs exist whether the log goes to a BC mill or a container ship to Yokohama. That is the industry's defence of raw log exports and it is not entirely wrong. The loggers kept working. The truck drivers had loads. The bush camps had crews.
What nobody adequately accounted for was what would happen when the old-growth accessible to existing mill operations ran out, and there was no investment in processing capacity for the timber that remained.
The Slow Collapse of Harvest Volume
Removing appurtenancy did not just allow companies to export logs instead of milling them. It removed the economic pressure that would have forced investment in BC's processing infrastructure. Companies that had been obligated to retool their mills for second-growth timber no longer had to. So most of them did not.
Over the following decade, as the accessible old-growth was exhausted, the annual harvest volume began to fall, because the processing capacity for what remained was not there, the economics of hauling logs from further afield did not work, and the companies that might have invested in new mills in BC were putting their capital into the US South instead.
Since 2010, annual harvest volumes in BC have plummeted by almost half. BC's Allowable Annual Cut has declined from 85.6 million cubic metres in 2007 to 59.6 million in 2024. Licensed commitments, the actual volumes companies have committed to harvest has dropped by more than 50%, to just 41.7 million cubic metres. The BC government's own budget projects a harvest level of only 29 million cubic metres over the next three years.
Less volume harvested means fewer trucks on the road. Fewer fallers in the bush. Fewer skidder operators on the landings. Fewer log graders and scalers at the sort yards. The work did not disappear all at once, it evaporated gradually over two decades as the harvest shrank, making it look like natural attrition rather than the consequence of a single policy decision made in 2003.
What Logging Contractors Are Actually Experiencing
The most telling description of what is happening to in-the-cut workers did not come from a union report or an academic study. It came from a BC MLA who grew up in a logging contracting family.
BC Conservative Megan Stamer, speaking in early 2026, described what she is hearing from contractors across the province: "I was in the industry as a logging contractor with my dad, and they've always had six months, eight months, almost a year's worth of work laid out. Now there's some of them that don't even know what they're going to be doing within a month. They've never seen it like this before."
That is not a mill manager. That is the person running the feller buncher. The crew on the skidder. The driver with the logging truck. The family that built a contracting business over a generation. They had predictable seasonal work planned a year out, that was the baseline of logging contracting in BC for as long as anyone could remember. Now they have a month of visibility, maybe, and some weeks nothing at all.
The Truck Loggers Association, which represents the independent contractors who are the backbone of BC's in-the-bush workforce, has been raising this alarm with increasing urgency. When the BC Council of Forest Industries describes the impact of mill closures and curtailments, they name the full chain: "the loggers and truck drivers, the unionized mill workers, the bioenergy and mass-timber producers, and the thousands of small businesses that rely on the sector." And when mills close, the cascading effect hits contractors fast. When the Atli Chip mill near Port McNeill closed in early 2026 following the Crofton pulp mill closure, Stamer noted that "you get something like a pulp mill that goes down, it can drag anywhere between four to six solid mills with it" and every one of those mills had contractors, truckers, and crews whose work disappeared with it.
Mechanization Changed the Work and Reduced the Workforce
There is one more layer to this story: the shift from old-growth to second-growth logging that appurtenancy removal accelerated also fundamentally changed how logging is done, and how many people it takes to do it.
Old-growth logging on BC's coast was labour-intensive. Hand fallers with chainsaws. Manual bucking. Cable yarding systems requiring significant crews at each stage. It was dangerous work that injured, disabled, and killed men on the cut. A cutting block that might have employed eight to ten people in the past, employs far less today.
Second-growth logging uses mechanized harvesters and forwarders, one operator in an enclosed cab processing trees that would have required three or four people to handle by hand. BC's own WorkBC labour market data confirms the trend directly: logging operations on BC's coast are using more mechanized skidding and harvesting equipment as the industry shifts to second-growth, resulting in increased demand for machine operators while gradually decreasing the demand for fallers and chainsaw operators. The skills needed on the landings have changed and will continue to change as mechanization replaces them.
The shift to second-growth that removing appurtenancy accelerated also shifted the labour profile of the work itself. Fewer people. Different skills. Less of the specific knowledge, the hand falling trade, the bucking craft, the cable yarding expertise, that generations of BC logging families built their livelihoods and their identities on. The guys who learned to fall trees from their fathers are being replaced not by younger fallers but by operators in harvester cabs.
This does not mean mechanization is wrong, productivity is what makes an industry competitive and is a lot safer for the logger in an industry known as risky.
Is Appurtenancy to Blame for Lost Logging Jobs?
Yes, but the link between the 2003 policy decision and the situation logging contractors face today is not direct, it is structural and delayed, which is exactly what made it politically invisible at the time.
Appurtenancy removal allowed mill closures without harvest reduction. That looked, initially, like the policy was protecting logging jobs while only affecting mill jobs. What it actually did was sever the economic feedback loop that would have kept processing investment in BC, which would have kept harvest volumes economically justified, which would have kept the trucks running and the fallers working at sustainable levels.
When the BC Truck Logger magazine's fall 2025 economic update described logging contractors and their employees suffering "blow after blow" and "tens of thousands of good family-supporting jobs" disappearing across the forestry value chain, that includes the people in the bush, not just the people in the mills.
The mill workers lost their jobs first and loudly, in announced closures with press conferences and union responses. The fallers and truck drivers are losing theirs slowly and quietly, as volume dries up and the work that used to be planned a year ahead cannot be planned a month ahead. One group shows up in the closure statistics. The other shows up in the slow hollowing out of small communities where the trucks used to run six days a week and now run two.
Both losses trace back to the same place: the decision in 2003 to remove the social contract that tied logging rights on public land to the obligation to keep the jobs in the communities those logs came from.
Why Are Canadian Mills Closing?
The Six-Layer Crisis Nobody Is Telling You About
Every time a mill closes in BC, the official explanation is some version of "tariffs and low lumber prices." Both of those things are true, but they are two items on a list of six compounding problems, and understanding only two of them means you cannot understand why this keeps happening, or what would actually fix it.
Here is the full picture.
There Is No Wood to Cut, The Fibre Supply Collapse
This is the number one driver right now, and it is more severe than most public reporting conveys.
Fibre supply in BC has fallen more than 40% since 2018, leaving the province operating at roughly 60% of the sustainable harvest level set by the province's own independent Chief Forester. Industry analysts describe this as the deepest sustained under-harvest in BC's modern history — and the situation worsened further in 2025.
On paper, BC has an annual allowable cut of 60 million cubic metres. The actual cut in 2024 and 2025 was around 32 million cubic metres, barely half the authorized level.
The causes are layered. Pine beetles killed millions of trees over three decades. Wildfires burned through accessible forest. Old-growth protections and caribou habitat requirements under the Species at Risk Act removed additional areas from the cut. And permitting delays mean that even where wood exists, getting cutting permits has become slow and expensive enough to price some harvests out of economic viability.
UBC forestry professor Gary Bull estimated that insect outbreaks and wildfires alone have contributed to a 50 to 60% reduction in available fibre near communities like 100 Mile House. West Fraser Timber, explaining its 2025 closure of the 100 Mile House mill, said it could not reliably access enough economically viable timber locally or further afield — and that tariffs made hauling from more distant areas uneconomic. Bull called for "an all hands on deck emergency response" from both federal and provincial governments.
US Tariffs Making It Uneconomic to Sell Finished Lumber
Even when a mill has wood, the market for its product has been severely damaged. Canadian softwood lumber entering the US now faces combined tariffs exceeding 45% — anti-dumping and countervailing duties of roughly 35%, plus a 10% Section 232 national security tariff added in October 2025.
Canfor's CEO Don Kayne was direct when closing two BC mills in September 2024: "Increasing regulatory complexity, high operating costs and the inability to reliably access economically viable timber to support our manufacturing facilities has resulted in hundreds of millions of dollars of losses in our B.C. operations." Canfor posted an operating loss of $532 million in 2023 on its Canadian operations alone.
The tariff impact compounds the fibre shortage. When a mill cannot access local fibre and must haul from further away, its costs go up. When those higher-cost logs become finished lumber, it must compete in a US market that charges 45% at the border. The margins disappear.
The Cascade, Closures Trigger More Closures
This is the dynamic that makes the current situation so dangerous and so different from previous downturns.
Sawmills anchor the entire forest products value chain. When they shut down, pulp mills, panel manufacturers, and pellet producers lose access to the residual fibre, the chips, sawdust, and shavings, that are the byproduct of sawmilling and the raw material for everything downstream.
The Crofton pulp mill closure in late 2025 is the clearest example. By the time Domtar announced permanent closure — affecting 350 workers and eliminating 380,000 tonnes of annual pulp production — the mill was already dealing with 27% fewer chips from local sawmills than it needed. To keep running, it had been importing wood chips barged in from California and Alaska at significant expense. That is an absurdity that even former NDP MLA Leonard Krog, now Mayor of Nanaimo, called "ridiculous, repugnant and unnecessary" — a BC pulp mill importing raw material from the United States because BC policy had allowed BC sawmills to close and BC logs to leave unprocessed.
The Drax pellet plant in Williams Lake closed at the end of 2025 for the same cascading reason: neighboring sawmill closures had eliminated its local fibre supply. In 2025 alone, BC lost three major operations: the Crofton pulp mill, the 100 Mile House West Fraser sawmill, and the Williams Lake Drax pellet plant. Each closure made the next one more likely.
Old Mills Built for Trees That We No Longer Cut
This is the structural problem that nobody adequately addressed when they had the chance and it connects directly to the decision to remove appurtenancy in 2003.
BC's coastal mills were built to process large-diameter old-growth timber from the accessible lower elevations. That timber is now largely gone, more than 90% of the most productive old-growth in the valley bottoms of BC's southern coast has been logged. What remains, and what is growing in second-growth forests, is smaller-diameter wood of different species mixes.
When Gordon Campbell removed appurtenancy in 2003, companies that held Crown logging rights were freed from the obligation to maintain and retool BC mills. The economically rational response was to export logs rather than invest in new mill technology to process a changing forest profile. Most of them did exactly that. The mills that were not retooled are now obsolete. The second-growth timber that the province does have cannot be efficiently processed in facilities designed for different trees.
Meanwhile, investment capital has been flowing south. BC forestry giants Canfor, West Fraser, and Interfor now own more sawmills in the United States than they do in Canada. West Fraser owns 16 mills in the US South versus 13 in Canada. Canfor owns 11 US mills. Interfor owns 13 US mills versus 5 in Canada. The companies did not leave the lumber business — they left BC. Modern mills in the US South process abundant second-growth pine at lower cost, with no tariff on the finished product.
High Operating Costs in BC Specifically
BC has become one of the highest-cost lumber production jurisdictions in North America, and the cost pressures have been building for years independently of tariffs.
BC Hydro electricity rates for industrial customers increased 25% in inflation-adjusted terms between 2007 and 2024. Forestry is both energy-intensive and transportation-intensive when the trees are further away and the mill runs on expensive electricity, every board foot costs more to produce. Rising labour costs, fuel costs, and increasingly complex environmental and permitting compliance requirements compound the pressure.
BC still has relatively low electricity pricing so this argument doesn't really hold much weight, the cost of fuel would be a bigger driver of increased production costs. The bigger problem for companies deciding if a mill is too costly to keep open comes down to economies of scale. How much does it cost per unit to produce and that equation factors in more than just the cost of electricity.
When fibre supply contracts and production volumes fall, fixed costs are spread across fewer units, which means the cost per thousand board feet rises even if nothing else changes. Many BC mills that might have survived at full or near-full production are uneconomic at the 60% of allowable cut that the province is actually achieving.
Lower Global Lumber Prices
The tariff story dominates the headlines, but lumber prices have also been deeply depressed, and the two problems multiply each other.
Benchmark Western SPF (spruce-pine-fir) prices declined sharply through 2024 and 2025 due to a slowdown in US residential construction, soft repair-and-remodel activity, and elevated interest rates suppressing housing demand. Multiple industry observers noted that the average Canadian sawmill was operating at or below break-even costs on lumber price alone, before tariffs. When tariffs added another 25 to 30% to the cost equation, producers that were already marginal moved into operating losses. The "Softwood Lumber, Tariffs, Turbulence and New Trade Flows to 2030" industry report concluded that these combined measures are pushing many sawmills into negative margins and that sawmill capacity in Canada will continue to decline through 2030.
Will BC Lumber Mills ReOpen?
Not easily. The fibre supply crisis is the product of pine beetles, wildfires, old-growth protections, and permitting delays, none of which resolve quickly. The obsolete mill problem is the product of the 2003 removal of appurtenancy and twenty years of capital flowing south rather than into BC processing capacity. The tariff problem is the product of four decades of the Canada-US softwood lumber dispute remaining unresolved. The cascade effect is the product of an integrated industry whose components are now failing sequentially.
And next to the Crofton pulp mill that just permanently closed, costing 350 workers their jobs and the region a major economic anchor, sat a giant log storage yard stacked with thousands of logs waiting for ships to take them raw to China, Korea, Japan, and the United States.
The full picture of why Canadian mills are closing is not a single villain. It is the compounding of decades of deferred decisions colliding with an acute tariff shock at the worst possible moment.
The wood exists. The policy to keep it in Canada and process it into jobs, wages, and community tax bases does not.
That is a choice. And choices can be changed.
Small Operators vs. Big Companies
Are Forestry Businesses Going Out of Business?
The answer depends entirely on which kind of forestry business you are asking about, and the answer for small operators versus large corporations is so different it tells you almost everything you need to know about how the industry actually works and who it actually serves.
Small Operators: Going Under
Yes. Small logging contractors, independent trucking operations, and small family-owned forestry businesses are going under, or surviving on such thin margins and such short work horizons that going under is a realistic near-term outcome for many of them.
The mechanism is direct and brutal. When a sawmill curtails operations or closes, it stops needing logs. When it stops needing logs, the contractors who supply it, the fallers, the skidder operators, the truck loggers, have no work and no revenue. They still have their equipment payments, their fuel costs, their insurance, and their debt. The equipment does not stop costing money because the mill stopped taking logs.
David Elstone, executive director of the Truck Loggers Association, described the dynamic plainly when Canfor was curtailing operations across multiple BC mills: "There is no revenue for those businesses, because that's what their job is, to deliver logs. The challenge is that the entire supply chain that feeds that sawmill is largely my membership, the logging contractor and their suppliers."
The Truck Loggers Association predicted at that point that the industry would take a 25% hit that could lead to bankruptcies. That was before the wave of mill closures that accelerated through 2024 and 2025.
When a Western Forest Products strike shut down Vancouver Island logging operations for seven months in 2019 and 2020, the Port McNeill Mayor said what nobody in Victoria wanted to say directly: "Western will recover. The union will recover. But we are at the point now where we are saying the ordinary people may not recover." The logging industry is vital to the economic health of the small communities and they supported the forestry workers on strike as best they could. A charity called Loonies for Loggers raised $110,000 just to help people with food hampers and basic financial assistance across 23 Island communities.
The structural problem for small operators is that they are completely exposed to volume fluctuations with no geographic or financial hedge. A logging contractor in the Cariboo cannot move their business to Louisiana when BC gets tough. Their equipment is financed, their trucks are leased, their crews are local, and their entire livelihood depends on whether the mill thirty kilometres down the road needs logs this month. When the domino effect of mill closures cascades through a region, one pulp mill closure dragging four to six sawmills with it, each sawmill taking its contractor network with it, small businesses in the radius of that closure have no cushion and no alternative.
Since 2000, more than 100 mills have closed in BC and approximately 60,000 forestry jobs have been lost. Most of the business casualties in that count are not the Canfors and West Frasers. They are the independent logging contractors, the small equipment dealers, the mechanics, the fuel suppliers, and the dozens of other small businesses that the BC Council of Forest Industries names explicitly when it describes who suffers when mills close: "the loggers and truck drivers, the bioenergy and mass-timber producers, and the thousands of small businesses that rely on the sector."
Large Companiea are Getting Out of BC
The big companies — Canfor, West Fraser, Interfor, Tolko. are not going out of business. They are leaving BC.
This is the distinction the media coverage rarely makes clearly enough, and it matters enormously for understanding what is actually happening to the industry and to the communities it built.
Through 2021 and into the years following, Canfor, West Fraser, Interfor, Tolko, and Teal Jones announced approximately $6 billion in combined investments to expand or establish sawmills in the southern United States, primarily Texas and Louisiana, to process the yellow pine that grows quickly in warmer climates. These investments were funded, in significant part, by the profits generated from logging BC's old-growth forests over decades.
West Fraser has invested more than US$4.5 billion in operations outside Canada since 2000. Interfor has invested over US$864 million in US sawmills since 2013. Tolko has disclosed US$400 million in US investments since 2018. In August 2024, Canfor signed a US$73 million deal to acquire forest operations in Arkansas, and less than one month later announced the closure of its Fort St. John and Vanderhoof mills, eliminating 500 BC jobs.
The numbers on where these companies now operate tell the full story. West Fraser owns 16 mills in the US South versus 13 in Canada. Interfor owns 13 US mills versus 5 in Canada — just 18% of Interfor's total lumber capacity is now in BC. Canfor has closed 10 of the 13 BC mills it once operated. As the Steelworkers union director Scott Lunny said when Canfor announced its Vanderhoof and Fort St. John closures: "If Canfor wants out of BC, and it sure looks like it does, then we need to find someone who will provide high-paying, community-supporting jobs for the right to harvest the timber."
These companies are not failing. West Fraser remains the largest lumber company in North America. They are making a rational capital allocation decision: the US South offers cheaper timber, lower operating costs, a more predictable regulatory environment, no softwood lumber tariff problem, and generous state-level tax incentives for new manufacturing investment. Louisiana offered Canfor an 80% property-tax reduction for up to ten years on its new mill investment.
BC, by contrast, has been described by independent equity analysts as essentially "uninvestable" a characterization that appeared in the BC Truck Logger Magazine's 2025 economic update. High operating costs, shrinking fibre supply, complex permitting, and an unpredictable regulatory environment have made the province the least attractive of Canada's forestry jurisdictions for new capital.
The Tenure Hoarding Problem
Here is the specific practice that makes the large company behaviour most controversial and where the question of fault becomes most pointed.
Five companies, Canfor, West Fraser, Western Forest Products, Interfor, and Tolko, hold approximately 27 million of the roughly 48 million cubic metres of harvestable timber in BC's Crown forest tenure system. Canfor alone holds 9.1 million cubic metres as the province's single largest tenure holder.
These companies hold that tenure as Crown land access rights. They hold it even when they are not harvesting it. They hold it even when they are closing BC mills and investing in US operations. And critically, because of the removal of appurtenancy in 2003, there is no longer a binding requirement that they process those logs in BC communities.
The result, which the Steelworkers union identified plainly, is that companies can close their mills, hold onto their timber rights, and export the raw logs or sit on the tenure while the community that built its economy around that mill withers. In Fort Nelson, Canfor had not harvested from its two main tenures since 2008 when its mills closed, but the tenure, and the logs that should have supported local jobs, remained in their hands while the community struggled. The municipality described the outcome directly: tenure was being used for "speculative hoarding of wood, and the export of unprocessed logs, and jobs, away from Fort Nelson."
The NDP government passed legislation to reclaim some of this tenure for redistribution to First Nations and smaller operators. The BC Truck Loggers Association has consistently called for the system to be reformed so that companies cannot hold tenure without a corresponding commitment to process that timber in the communities where it is harvested.
Are the Big Companies to Blame for BC Forestry's Fall?
Yes, but they are not the only player to blame in this story.
The large companies are making logical decisions within the system they operate in. If the policy framework gives you the right to log Crown land without processing locally, you will export logs when it is more profitable. If the regulatory environment makes BC the highest-cost operating jurisdiction in North America, you will invest where costs are lower. If the US South offers abundant timber, lower regulation, and generous tax incentives, you will build mills there. These are not villainous decisions, they are predictable responses to the incentive structures that governments created.
West Fraser's CEO Ray Ferris described what he called the "grand bargain" that had historically existed: forest companies got access to Crown timber in exchange for investments in sawmills and pulp mills that provided jobs. The government is now rewriting the terms of that bargain, but the rewrite is happening after decades of the old terms enabling exactly the capital flight the rewrite is trying to prevent.
The environmental analysis is harder to dismiss. Wildsight's research noted that companies like Canfor, West Fraser, Interfor, Tolko, and Western Forest Products were "well aware" that as the old and primary forests they built their businesses on disappeared, so too would their competitive advantage and they invested the profits from liquidating those forests into building businesses in places where comparable forests still existed. That is a harsher framing, and it is not entirely wrong.
But assigning primary blame to the large companies misses the deeper accountability. The companies operated within a regulatory framework that permitted and sometimes actively encouraged everything they did. Gordon Campbell's government removed appurtenancy, issued raw log export permits at record rates, and stripped the conditions that would have required ongoing investment in BC communities. The successive governments that watched tenure concentrate in five companies' hands without action, that watched capital leave for the US without creating incentives to keep it in BC, that cut the firefighting budget and then faced catastrophic fire seasons, that approved harvest rates above long-term sustainable levels during the pine beetle period and then faced the fibre famine when it ended, those are the decisions that compounded into the crisis BC's forestry communities face today.
The large companies did get fat from BCs forests and then left the people who made them all that money in the lurch without a second thought. That's business and it leaves a sour taste in everyones mouth. However, the reason they could screw a whole province over is because the BC governments enabled it, watched it happen, and did nothing to protect those whom these big companies left behind.
The small operators and the communities are the victims of corporate greed and government ineptitude.
Is There a Solution for the BC Forestry Industry?
Yes, The appurtenancy conversation is not finished. As recently as 2024, communities like Houston have been actively calling for its reinstatement after Canfor announced it would end reinvestment in the local sawmill. Houston's Mayor and Chamber of Commerce joined a growing chorus of northern BC community leaders demanding that Crown timber be tied back to local processing.
The BC government has signalled it will begin restoring some version of the requirement. But two decades of lost investment in mill capacity is not undone by a policy reversal. It requires capital, new mills configured for second-growth species, and stability a guarantee that the policy will remain in place long enough to justify the investment.
What Canadian businesses, communities, and policymakers should take from the raw log story is not just frustration at the status quo. It is a lesson in what happens when you remove the social contract that made resource extraction politically and economically justifiable in the first place.
Appurtenancy was not a subsidy, it was a condition. When you remove conditions from public resource extraction, you get extraction without the public benefit. Every raw log that leaves BC's ports without being processed is a job, a tax base, a school, and a community that did not happen here.
That is not climate. That is not pine beetles. That is a policy choice and policy choices can be changed.
Is BC's Forest Industry Dead?
Solutions, Survival, and What the Future Actually Looks Like
A version of it will. But it will be smaller, structurally different, and built on foundations that the industry has spent decades avoiding building. The question is not whether change is coming it is whether the change happens on BC's terms or by default.
The consensus among union leaders, industry experts, and policy analysts who have been watching this most closely is captured bluntly by Jim Rushton, a 46-year veteran of BC's resource and transportation sectors: "This is do-or-die time to stabilize the forest industry in British Columbia."
That framing does not mean the industry is dead. It means the window for a managed, strategic transition is narrow, and every closure, every month of inaction on permitting, every additional log that leaves the province unprocessed makes that window smaller.
Several paths forward are being actively developed. Some are real and showing early results. Some are promising but not yet at scale. Some are politically necessary but structurally insufficient on their own.
Fix the permitting nightmare — immediately
This is the most urgent short-term lever and the one with the least excuse for delay. The actual cut in BC is running at roughly 32 million cubic metres against an authorized level of 60 million, the gap is not entirely explained by fibre shortage. A significant portion of it is permitting. Getting a cutting permit in BC takes an average of 25 days even after the government recently reduced it from 40 days. Forests Minister Ravi Parmar has said his goal is to eliminate cutting permits altogether and transition to operational planning forestry, where companies operate under long-term forest landscape plans rather than permit-by-permit approvals.
This matters enormously for contractors and small operators, whose work pipelines collapse when permit timelines are unpredictable. BC Timber Sales has already increased its auctioned timber volume by at least 700,000 cubic metres in 2025-26, equivalent to about 15,500 additional truckloads of fibre flowing to local mills. That is a real and meaningful increase, even if it is still far short of the authorized cut.
Unlock fibre that is already there — the damaged timber opportunity
An estimated 215 million cubic metres of wildfire-damaged and insect-damaged timber currently sits in BC's forests largely unutilized. The BC Forest Leadership Report has called for a fast-track cutting permit process specifically for damaged stands, with pilot projects beginning on both coast and interior in early 2026. The Forest Enhancement Society of BC allocates roughly $50 million per year to support fibre utilization and fire mitigation, expanding that mandate and funding could unlock significant volume relatively quickly.
Additionally, there are approximately 2 million cubic metres of unused roadside fibre, wood already harvested and sitting at logging sites, that is not being utilized. If this fibre were processed rather than burned or left to rot, it would strengthen supply to existing mills and support emerging value-added manufacturers without requiring any additional harvesting.
Mass timber and value-added manufacturing — the industry the future demands
This is the most strategically important long-term path and the one where BC has genuine, defensible competitive advantage.
BC has spent the past decade positioning itself as a North American leader in mass timber construction. Building codes have been revised to allow 18-storey mass timber buildings. BC now has more than 900 value-added wood manufacturing facilities, contributing $1.4 billion in GDP in 2024. The province's Wood First initiative and Forestry Innovation Investment programs are actively working to develop markets in Japan, China, India, the UK, Vietnam, South Korea, and the Middle East, markets where BC's sustainably certified, high-quality wood products have differentiated appeal.
The federal government's $1.2 billion forestry support package includes $500 million specifically for market diversification and new product development including low-carbon wood-fibre-based insulation, prefabricated construction panels, engineered wood products, and bioproducts. BC expects to receive 40 to 50% of that funding given its share of the Canadian timber industry.
This matters because it represents a fundamental shift in the value equation. BC has been generating approximately $233 per cubic metre of timber harvested, compared to Ontario's $839, largely because BC processes so little of what it cuts. Mass timber and value-added manufacturing are how BC begins to close that gap, extracting 3x to 4x the value from the same volume of wood, which means the industry can be viable at lower harvest volumes.
One particularly promising innovation: New Zealand is exploring distributed manufacturing using shipping container-sized mini-factories capable of scalable processing, biochemical conversion, and pulping. Because of their size, they can be located near the harvest rather than requiring logs to travel to large centralized facilities. This model has direct application in BC's remote communities and could change the economics of second-growth processing in areas that currently cannot support a conventional sawmill.
Canada's housing crisis as a demand opportunity
Both federal parties have committed to dramatically increasing Canadian housing starts. Carney's government has set a target of 500,000 housing starts per year through 2035. If even a fraction of that building is done with mass timber, engineered wood, and prefabricated wood construction systems, it creates sustained domestic demand that is not dependent on the US export market or vulnerable to softwood lumber tariffs.
Pre-fabricated wood construction and mass timber can build housing faster and more affordably than traditional methods, which means BC's forest industry and Canada's housing affordability crisis have a shared solution waiting to be scaled. The industry that built the province for 150 years is positioned to build its housing future, if the policy alignment happens.
Community forests and Indigenous forestry
One of the most significant structural shifts underway is the redistribution of tenure from large corporations to First Nations communities, community forests, and smaller operators. The BC government has passed legislation enabling tenure take-back and redistribution. As of 2022, 126 of BC's 204 First Nation communities had existing forestry revenue-sharing agreements. The BC Community Forest Association's 2025 report makes the case directly: "The success of community forests shows what is possible when forest management is locally driven. Community forests demonstrate how local people, working together, can steward forests in ways that deliver lasting economic, ecological, and cultural benefits."
This is not just an equity argument, it is an economic efficiency argument. Local communities have the strongest incentive to manage timber supply sustainably because they cannot pick up and move their operations to Louisiana. The interests of the community and the interests of the forest are aligned in a way they never were when five Vancouver-headquartered public companies held most of the tenure.
The structural reforms that have to happen
The Provincial Forest Advisory Council's 2026 report, *From Conflict to Care*, has proposed the most systematic framework for restructuring the industry, and it has received broad support from unions, the Truck Loggers Association, BC Greens, and the BC First Nations Forestry Council. Its main recommendations: replace the current volume-based timber allocation system with Regional Forest Management Areas that integrate ecological and economic planning together; fix the archaic data collection systems that result in inaccurate harvest projections; and replace stumpage fees with a royalty-style system aligned with market conditions, the way other extractive industries are structured. The Steelworkers Union, which represents the workers with the most to lose if the industry collapses, supports this direction. That alignment between labour, Indigenous communities, environmentalists, and small industry operators is itself significant, it has rarely existed in BC forestry before.
Will the BC Forest Industry Survive?
Yes — but not in its current form, and not for everyone equally.
Here is the realistic picture of what BC's forest industry looks like in 2030 and beyond:
The large integrated companies — Canfor, West Fraser, Interfor, will continue operating in BC at a smaller scale than they do today. They will maintain some tenure and some mills, primarily the most efficient modern operations. But they are already North American companies with a minority of their capacity in BC, and that trajectory will not reverse. The BC component of their business will shrink relative to their US operations.
The vacuum they leave will increasingly be filled by Indigenous-owned forest businesses, community forests, and mid-sized operators who specialize in value-added products for domestic and international markets. This is a healthier ownership structure for BC communities even if it is a smaller overall industry. These entities are more environmentally focused than commercially focused so the amount of actual logging that is completed will probably be much lower and result in less overall jobs.
The commodity lumber business — high-volume dimension lumber for the US housing market, will contract significantly and may never return to its historic scale in BC. The combination of tariffs, fibre supply constraints, and the US South's cost advantage makes it structurally uncompetitive for BC to win on volume commodity production.
The value-added sector — mass timber, engineered wood, prefabricated construction, bioeconomy products, will grow. BC has real competitive advantage here: sustainably certified wood, engineering expertise, proximity to Asian markets, and a reputation for quality. The question is whether the policy environment and the capital investment can scale this sector fast enough to replace what commodity lumber is losing.
Rural forestry communities will continue to face severe stress through the transition. The communities built around high-volume sawmills, Mackenzie, Fort St. John, Vanderhoof, 100 Mile House, will not all survive in their current form. Some will find new economic anchors. Some will not. The social cost of the transition is real and it is disproportionately borne by the people who had the least control over the decisions that created the crisis.
BC's forest industry is not dead. But the version of it that built hundreds of rural communities, employed 90,000 people, and accounted for 5% of provincial GDP, that version is gone and it is not coming back. The groups standing up to take over from the large companies are not interested in building big commercial organizations that will employ thousands of people.
What survives will be smaller, more diverse, more local in ownership, more sophisticated in product mix, and if the right decisions are made in the next three to five years, more resilient to the external shocks that have been destroying it.
The tools exist. The markets exist. The political will, for the first time in a long time, appears to be forming across party lines. What does not exist is time. Every month that the permitting backlog continues, every mill that closes without a successor operation, every skilled faller or trucker who leaves the industry for oil and gas or construction is a loss that compounds.
The clock is running. The window is still open. Whether anyone walks through it in time is the question BC's forest industry has to answer in the next few years.
What the Federal Government Did for BC Forestry
In August 2025, Prime Minister Carney announced a $1.2 billion federal support package for the softwood lumber industry. The package includes $700 million in loan guarantees that companies can use to finance and restructure operations, and $500 million in grants to diversify export markets and develop new product lines, including reinforced timber and wood-fibre-based insulation for prefabricated homes. Canadian lumber producers also have access to priority procurement in federal programs, including housing on military bases as defence spending ramps up, and the government's broader goal of doubling housing starts to 500,000 units per year through 2035 increases domestic demand opportunities.
The government has also sent trade missions to Japan, South Korea, and China, the largest BC forestry trade mission to Asia on record departed in November 2025, and is actively building a case for the Middle East, the UK, North Africa, and Mexico as emerging export markets.
BC Forests Minister Ravi Parmar has been explicit: "My message is clear: We will not be defined by American protectionism."
No it's been defined by bad BC government policy, pine beetle infestations, wildfires getting out of control, and the industry choosing to get the quick buck instead of building a sustainable longterm industry.
What You Can Do as a Canadian Consumer and Business Owner?
This is not abstract policy, it has direct implications for decisions that ordinary Canadians and Canadian businesses make every day.
If you are building or renovating, ask your contractor where the lumber is coming from. Demand Canadian-sourced wood. Ask if they are going through a local lumber yard or Home Hardware rather than defaulting to a US-owned chain. That choice has a supply chain consequence. Canadian demand for Canadian lumber supports Canadian mills and Canadian mill workers.
If you are in construction, in building supply, or in any adjacent industry, the federal support programs are open. The $700 million in loan guarantees and $500 million in market and product development funding are not just for the large integrated companies. Small and medium-sized businesses in the forestry and building materials supply chain can access support. Contact your provincial forestry ministry or the federal Trade Commissioner Service to find out what applies to your situation.
And if you are thinking about career options, trades, engineering, forestry management, environmental science, supply chain, the industry is not dead. It is restructuring. The companies that make it through will be smaller, more diversified, more finished-product oriented, and more export-sophisticated. The people who build those skills now are the ones who will have options inside that transformed industry.
Why is the BC forest industry struggling?
The BC forest industry is facing pressure from multiple directions at once, including rising operating costs, shrinking timber supply, mill closures, labour shortages, wildfire damage, transportation costs, global market shifts, and ongoing trade disputes with the United States. While tariffs have played a role, the industry’s challenges are much broader and more structural.
Did Trump’s tariffs hurt the BC forestry industry?
Trump-era tariffs on Canadian softwood lumber increased costs and uncertainty for Canadian producers exporting into the U.S. market. However, tariffs were only one factor affecting the industry. Many underlying issues — including fibre shortages, changing housing demand, and long-term industry restructuring — already existed before the tariffs were introduced.
What is the softwood lumber dispute?
The softwood lumber dispute is a long-running trade conflict between Canada and the United States. The U.S. argues that Canadian lumber producers benefit from unfair government subsidies through provincial stumpage systems, while Canada argues its forestry system is legitimate and market-based. The dispute has resulted in repeated tariffs and trade negotiations over several decades.
Why are sawmills closing in British Columbia?
Many BC sawmills are closing due to reduced timber availability, higher production costs, declining profitability, wildfire impacts, transportation expenses, and changing global demand. Some mills are also struggling to compete with lower-cost lumber producers in other regions.
How do housing markets affect the forestry industry?
Housing construction directly impacts lumber demand. When housing starts slow down, especially in the United States — demand for Canadian lumber often declines. Interest rates, construction activity, and broader economic conditions all influence how much lumber the market requires.
Is the BC forestry industry collapsing?
The industry is not disappearing, but it is undergoing a major transformation. Traditional forestry operations are under pressure, while areas such as engineered wood products, automation, robotics, sustainable forestry, and advanced manufacturing may become increasingly important to the sector’s future.
How important is forestry to British Columbia’s economy?
Forestry has historically been one of British Columbia’s most important industries, supporting jobs, exports, manufacturing, transportation, and many rural communities. Although the industry has changed significantly over time, it remains economically important across many regions of the province.
Could the BC forest industry recover?
Recovery is possible, but the industry will likely look very different in the future. Long-term competitiveness may depend on innovation, automation, sustainable resource management, diversification into higher-value wood products, and adapting to changing global markets
What role do wildfires and climate change play in forestry?
Wildfires, drought, pests, and climate-related environmental pressures are increasingly affecting forest health and timber supply in British Columbia. These factors create additional uncertainty for forestry companies and contribute to long-term supply challenges across the industry.
Why are lumber prices so volatile?
Lumber prices are heavily influenced by housing demand, global economic conditions, supply chain disruptions, tariffs, transportation costs, and production capacity. Events such as interest rate changes, pandemics, trade disputes, and natural disasters can all create rapid swings in pricing.
Trump did not kill the Canadian forest industry. The pine beetle, the wildfires, the drought, decades of US tariff disputes, and the industry's own over reliance on a single market, BC government policy, large forestry corporations did most of the damage long before this administration's tariffs arrived. Trump poured accelerant on a fire that was already burning.
The thing that will kill the industry is doing nothing.
The companies and communities that survive this will be the ones that diversify their markets, invest in value-added products, and stop treating the US as a birthright customer. That path is hard. The government support is real. The global demand for sustainably produced Canadian lumber is real. Japan, the Middle East, and a domestic housing boom are real.
The question is whether the industry will take the hero's path, or keep waiting for someone else to solve it.
Shannon Peel is the founder of MarketAPeel and a Brand Narrative Strategist who grew up in BC's forestry economy and now helps Canadian businesses read economic signals and position for opportunity. She publishes video and written analysis on Canadian trade, business resilience, and brand strategy.
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