By: Serena Lapointe
With the United States changing up its tariff system, placing a 25 percent tax on incoming
goods from Canada and Mexico, among other countries, and seeking to impose reciprocal taxes
on all countries that import into the USA, essentially charging the same tariffs on countries that
already charge tariffs on The United States, industry leaders in Alberta are looking to their allies
for support.
At a recent Whitecourt Town Council meeting, Brock Mulligan, Senior Vice President of the
Alberta Forest Products Association (AFPA), along with several industry leaders from the area,
presented an overview of what Alberta’s forestry industry is facing and how community leaders
can help support changes by advocating to the provincial government.
“Times are a little uncertain for our industry, and we’re doing what a lot of folks do in uncertain
times, and that’s come to see some of your friends and chat a little bit about steps that could
help mitigate some of the uncertainty that we are going through,” started Mulligan. “We’re here
because we know that municipal advocacy works, and we want to chat a little about the
situation and some ways that the provincial government might support the industry in these
times.”
The AFPA requested that Whitecourt Town Council send a letter to the provincial government.
“We’re starting to see tariffs and duties combining to produce pretty scary results. The letter, we
were hoping, would talk about some of the mitigative actions that could be taken to help us
through this time.”
In Alberta, the forestry industry employs around 30,000 people and has a 14-billion-dollar
impact on the provincial economy. “Collectively, our members pay about 75 million dollars’ worth
of property taxes to municipalities to support the type of services that we all love and enjoy,”
explained Mulligan.
He said that not only are the tariffs from the United States worrisome but so are the duties on
softwood lumber. “Lumber market prices spiked during COVID. The relationship is that higher
prices lower duties, so we saw the duties come down quite a bit in that period, but when you
have a substantial year-to-year change in the prices, where they’ve now fallen significantly, that
has an inverse effect. It’s quite a sharp rise because of how quickly the market changed. Based
on where prices were two years ago, we are likely to see duties increase dramatically, probably
from 14 percent to somewhere in the 30 to 35 percent range. If you add tariffs and duties
together, we’re talking for lumber, potential trade barriers in the fifty to sixty percent range,”
explained Mulligan.
The first advocacy piece was speaking to Americans about the value of Alberta forest products.
“They help build affordable housing. Pulp goes into the USA and (is used) to make things
consumers from all over the world buy, including Canadians, which fuels jobs there through
retail, trucking and construction. There are a lot of jobs, and we think this is a strong message.”
The second was to advocate for keeping Alberta’s regulatory costs low, something Mulligan said
Alberta is already the strongest in doing. “It’s a very competitive jurisdiction (here) with a very
supportive provincial government.” Mulligan said keeping the focus on Alberta things, like
permitting, approvals, and timelines, is crucial to help conserve industry dollars.
Next was building things in Alberta with Alberta wood. “We know that this council has been
tremendously supportive in the past. You helped us catalyze the movement to get the taller
wood buildings allowed under Alberta’s Building Code, which has been a real help for the
industry. Whitecourt was the first municipality to support us and send a letter.”
Then, Whitecourt-Ste. Anne MLA George Vanderburg brought the bill forward (Bill 203) in 2015
to change Alberta’s safety codes to allow for wood-constructed buildings up to six storeys. The
bill passed that year and has since been updated, allowing up to twelve storeys.
One of the world’s tallest wood-constructed, mass timber buildings, dubbed The Woodscraper,
is a Canadian marvel. The student residence at the University of BC is 54 meters high, a
whopping eighteen-storeys. It was completed in only 70 days, with some ready-to-assemble
prefabricated pieces.
Mulligan said a “Build with Alberta Wood” act could drive demand for Alberta wood locally,
lowering the industry’s reliance on exporting to the USA. BC and Quebec have similar policies.
The Office of Mass Timber Implementation in BC was the world’s first. The mandate of the office
is to make it easier to build with mass timber and to expand its use in BC buildings.
“We are likely going to have trouble sending products across the border into the States. Using
more of our resources here at home is something we think makes a tremendous amount of
sense.” Mulligan noted this would not discriminate against wood from other provinces. “We’re
just saying that if we built more with wood, particularly in some of the procurement decisions
that the province makes, we could use more of our resources from communities like Whitecourt
here at home and help shield some of the burdens that we’re going to see when these various
types of trade barriers come in.”
The fourth advocacy piece was to ask the province to advocate to the federal government. “The
softwood lumber dispute has drug on since 2016 when the last agreement lapsed. During that
time, the Americans have continually been collecting duty deposits that are on hold until the
dispute is resolved. There’s ten billion dollars worth of Canadian lumber producers’ money
sitting there,” explained Mulligan.
“Our ask is that the province lobbies the Federal Government to consider backstops tied to those
10 billion dollars in deposits. Essentially, the feds would make loans to lumber companies and
would be paid back when the ten billion dollars came back. It may be a step that is necessary to
keep mills running and folks working if things get ugly,” he said.
Next was support for market diversification. “There is no panacea for access to the USA market
because they take such a tremendous volume of our products. But it is a time that makes sense
to look at other places.” He mentioned India, the Philippines, China, Japan and Korea. He also
credited the Community Rail Advocacy Alliance. Whitecourt Mayor Tom Pickard sits on the
board with other community leaders. “There’s no way to get those products there efficiently with
our current transportation system. When we’re having conversations about how we can diversify
our markets, this is a foundational step, so continuing with that is important.”
The last advocacy was to ask Alberta’s Government to implement a Forestry Manufacturing Tax
Credit to help encourage investment in new products and technologies. “There’s one of these
for petroleum producers and one for agricultural producers and not yet one for forestry,”
explained Mulligan. He said the province issues mandate letters to each minister and that two
ministers have this on their desks. “It’s certainly on the radar now it’s just about getting it over
the line.” Whitecourt Town Council voted unanimously to approve the AFPA request to send an
advocacy support letter to the Alberta government.
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