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Fall 2019

What is Old Growth? Future Opportunities for Forestry Education

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Stumpage: What You Need to Know

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CONTENTS

FALL 2019 Volume 42 Number 3 www.tla.ca

33

Columns & Departments 7 8

38

TLA President's Message

We Need Better Control of Our Destiny

Cover

42

50

42 What is Old Growth? Jean Sorensen

Mike Richardson

TLA Executive Director's Message

Provincial Forestry Industry Meltdown David Elstone

10 Southern Interior Perspective

Industry in Crisis Todd Chamberlain

13 North West Perspective

Waiting for Provincial Permits Trevor Jobb

14 Northern Interior Perspective

Consequences of Sawmill Closures Paul Schuetz

17 Business Matters

Strategies to Manage Your Business' Cashflow Chris Duncan

18 Safety Report

Forestry Operations: Who Does What?

Features 22 Forestry Community: Port McNeill Robin Brunet

25 Calling Future Log Haulers Greg Munden

33 Recovering Caribou: Analysis of the Blair Lekstrom Report Paul Schuetz

38 Managing for First Nations Cultural Values Ian MacNeill

40 Future Opportunities for Forestry Education Adrienne Tanner

50 TEAAM is a Solution to Emergency Medical Care John Betts

54 Stumpage: What You Need to Know Mike Greig

Budd Phillips

21 Market Report

Another Turn for the Worse David Elstone

Cover Photo: iStock

Fall 2019 Truck LoggerBC 3


The Truck Loggers Association 2019 Executive & Directors

Interior Logging Association 2019-2020 Board of Directors

Chairman Randy Spence Mike Richardson First Vice Chairman Len Gudeit Bill Nelson Second Vice Chairman Ron Volansky Jacqui Beban Past Chairman Reid Hedlund David Elstone Directors Guido Claudepierre Sig Kemmler Dennis Cook Dave McNaught John Drayton Jen Norie Creole Dufour Clint Parcher Randy Durante Mark Ponting Frank Etchart Aaron Service Sue Hagarty Barry Simpson Scott Horovatin Dorian Uzzell Lennard Joe Matt Wealick Hedley Larsen Associate Directors Tyson Lambert Don Mathews Tim Lloyd Shawn McIver Brian Mulvihill Tim Menning Carl Sweet Shari Smaha Lawrence Van De Leur General Manager Todd Chamberlain Editorial Board Jacqui Beban Administration Nancy Hesketh Chris Duncan David Elstone Interior Logging Association Jennifer Kramer 3204 - 39th Avenue Brian Mulvihill Vernon, BC V1T 3C8 Mike Richardson Tel: 250.503.2199 Fax: 250.503.2250 Dorian Uzzell

President Vice President Past President Executive Director Industrial Directors

E-mail: info@interiorlogging.org Website: www.interiorlogging.org

FALL 2019 / VOLUME 42 / NUMBER 3 Editor Jennifer Kramer Contributing Writers John Betts

Robin Brunet Todd Chamberlain Chris Duncan David Elstone Mike Greig Trevor Jobb

Ian MacNeill Greg Munden Budd Phillips Mike Richardson Paul Schuetz Jean Sorensen Adrienne Tanner

For editorial information, please contact the Truck Loggers Association: Tel: 604.684.4291 Email: trucklogger@tla.ca

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For advertising, please contact Advertising In Print: Tel: 604.681.1811 Email: info@advertisinginprint.com Truck LoggerBC magazine is published four times a year by the Truck Loggers Association, with content and support from the Interior Logging Association and the North West Loggers Association. Its editorial content seeks to reflect issues facing the industry and to provide readers with current information on BC’s forest industry. All rights reserved.

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Advertising In Print 200 - 896 Cambie Street, Vancouver, BC V6B 2P6 Tel: 604.681.1811 Fax: 604.681.0456 Publication Mailing Agreement No. 40010419. For subscriptions, contact office@tla.ca or 604.684.4291. Send change of address notices and covers of undeliverable copies to: The Truck Loggers Association Suite 725-815 West Hastings Street Vancouver, BC V6C 1B4 E-mail: contact@tla.ca

Tel: 604.684.4291 Fax: 604.684.7134 Website: www.tla.ca


from the Editorial Board DESK...

W

elcome to the Fall 2019 issue of Truck LoggerBC. In this issue, several articles and Associations’ perspective pieces address the current forestry industry crisis and propose potential solutions. We explore what you need to know to understand the ins and outs of stumpage, how the time lag affects rates, and how the assessed rate affects harvesting decisions. BC has made significant strides in old-growth preservation and yet we continue to need to fight to protect our working forests. In “What is Old Growth?” we take a deep dive at defining old growth to clarify once and for all what, in fact, it is, and how government guidelines preserve oldgrowth forests. In “Forestry Community—Port McNeill”, Mayor Gaby Wickstrom speaks openly about old-growth timber harvesting in her community, addressing the false notion that we devastate forests, and her work towards dispelling misinformation about the logging industry. On the education front, two articles highlight the support of ongoing efforts for the forestry industry. The Festival of Forestry was started in 1967 by former Truck Loggers Association President Bill Moore, who recognized public misperceptions, particularly among teachers, towards the industry. To help counter the misinformation, he formed the non-profit educational society to provide annual tours to educate teachers about BC forest management. Also, BC Forest Safety Council’s new log haulers training program was developed in response to a gap in Class

1 licensing and the competency required of a professional log truck driver, a shortage of qualified log truck drivers in BC, and an inability to properly train new entrants into the industry to operate consistently to an industry-set standard of professionalism, safety and performance. From Blair Lekstrom’s report, “The Path Forward to Recover the Caribou Plan in Northern British Columbia,” we take a critical look and respond to several of his recommendations that are most relevant to TLA members and the forestry industry as a whole. On a positive note, “Vision 20/20” is the theme for the 77th TLA Annual Convention + Trade Show and our session topics will provide a vision into the future, providing a range of perspectives and an outlook for timber harvesting contractors. Registration opens on October 16, 2019. As always, I trust you will find this issue insightful and informative. If you have any feedback or comments, please contact our Director of Communications, Jennifer Kramer, at 604-684-4291 (extension 2) or by email at jennifer@tla.ca.

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Mike Richardson

TLA President’s MESSAGE

We Need Better Control of our Destiny

I

t is with great frustration that as I write this in mid-September I am once again, like my fellow contractors, going through yet another significant downturn in the Province’s forestry industry. Somehow, we endure as timber harvesting contractors, but there are always casualties in times like these. In the last week alone, there have been headlines about Interfor announcing the closure of their Hammond sawmill in Maple Ridge affecting 147 direct sawmill workers, Teal-Jones indefinitely halting Coastal logging operations impacting 300 contractors and their workers, and another 500 Teal-Jones workers at their sawmills once logs run out, and Tolko indefinitely curtailing their Kelowna sawmill, affecting 127 sawmill workers. And then there’s the 400+ workers impacted in MacKenzie earlier this summer at Conifex and Canfor; and the list goes on. The provincial government estimates approximately 2,547 workers in 13 Interior communities have been impacted by indefinite curtailments or shift reductions, 497 workers in three Interior communities have been impacted by permanent closures, and 728 more are experiencing some impact resulting from temporary curtailments. It’s additionally frustrating to read headlines about a mill closure but there’s very little recognition of some 3,000 workers and contractors who are caught between the United Steelworkers and Western Forest Products labour conflict going into its third month. Why hasn’t that made the headlines? It’s in times like these when the advocacy efforts of the TLA is more important than ever. Over the past summer, we have also been busier than ever lobbying government on behalf of our members. We are doing all we can to identify and raise issues with all levels

of government—mayors, MLAs, ministers and the Premier, to ensure we have a voice at every table and they hear our concerns. As always, I get asked how will the TLA help? The TLA Board has known and communicated for years that contractor sustainability needs to be addressed well before the sector enters into conditions such as we see today. If you are not working, and there are no options because everyone else is not harvesting, sustainable rates don’t matter. I hope that government leaders finally get this message as I am sure we will be witnessing financial hardship soon enough. Over the summer, we continued to meet with other forestry associations and government about the Contractor Sustainability Review to fight for changes to Bill 13. I know many of you are wondering when are you going to see changes on the ground; I am as equally frustrated, it’s been a lengthy, arduous task with slow results, but the TLA will persist to ensure our voice is heard so contractors will have a future that is better than today. I can assure you government is committed to making changes but it’s the details that take time to negotiate between the licensees and contractors. In June, the TLA launched a Forestry Equipment Hourly Rates publication in partnership with TimberTracks™, an invaluable tool for contractors to create awareness about equipment rates. How many times have you had to negotiate the rate of a yarder with someone that has never owned or operated one? The new publication was initiated by the TLA to help its members and their employers know what their equipment is actually worth for hourly charge out. BC Wildfire Service has embraced and used these reference rates for contractors’ equipment. For the industry,

if both negotiating parties are truly committed to a viable supply chain, and contractors are truly part of the team, then licensees should be using this information as well. In hindsight, times were good over the last few years because at least most of us were working. The TLA, along with the other associations, recognized that good times don’t last forever, and sooner or later, some licensees, including timber sale licences, become insolvent. Most definitely we are in such a period right now where I wouldn’t be surprised if some licensees are not able to pay their contractors. It is for this reason the TLA lobbied hard to see the creation of the Forestry Service Providers Protection Fund, which over successive years, has approximately $7 million available for unpaid contractors to apply for. Be sure to keep on your invoicing because in times like this, paper work is very necessary. As a contractor, like many others, I know having no revenue is very hard. What I can also see is the damage being done to the industry’s image. Workers need to pay mortgages. If we can’t offer our employees steady work due to strikes or layoffs, we won’t be able to attract and retain them. This must change. We need to have better control of our destiny. The TLA is absolutely committed to working tirelessly to bring contractors the fair policies they deserve and do what we can to ensure this downturn does not drastically impact the future of this industry. Mike Richardson, President, TLA Tel: 250-203-2649 Email: mike@tsibass.ca

Fall 2019 Truck LoggerBC 7


David Elstone

TLA Executive Director’s MESSAGE

Provincial Forestry Industry Meltdown

M

y prediction that conditions were becoming very bad in the Summer 2019 Truck LoggerBC issue was not an overstatement. Trade and production data (see pages 21, 48 & 49) show strong indications of sector weakness on par with the last major downturn of 2009-2010. Heading into early fall, timber harvesting contractors, their suppliers, workers and families are facing a province-wide forestry industry meltdown. The Coast must contend with the United Steelworkers/Western Forest Products strike well into its third month (at time of writing), Interfor’s timber operations reconfiguration, and Teal-Jones halting all timber harvesting. And in the Interior, numerous mills including Canfor, West Fraser, Tolko and Norbord announced either production curtailments, or permanent closures. The common theme throughout is contractors and their workers are being cast aside when economics don’t make sense for their employers, the major licensees, to continue. Retrenchment is rational from the majors’ perspective who have seen a return to financial health, but devastating to a contracting community that has been fighting to survive, even during the best of times. Typically, in tough market conditions, seeking to lower delivered log costs becomes the mantra to achieving competitiveness for the major licensees. But squeezing the supply chain is not going to work in this downturn as contractors have nothing left to give with many already at the breaking point. There is no doubt there is a recession in the BC forestry sector. However, conditions are different from the last go-around in 2009-2010: • China was just becoming a major market for BC logs and lumber— today BC’s international markets are diversified more than ever with China representing the largest market for BC logs and second largest destination for BC lumber.

8 Truck LoggerBC Fall 2019

• Major BC lumber producers still had

the majority of their capacity within BC—today most major lumber producers have invested in sawmilling capacity in the US. And most importantly, • There was a major global recession centred around the collapse in US housing starts—today, as of yet, there is no broad economic recession in Canada or the US, but US housing starts are stagnating. While we can’t avoid the boom and bust of commodity markets, a crisis is an opportunity to make bold changes to strengthen the sector. One thing is for certain, we don’t need another round table or process to study the issues. The TLA offers the following solutions for government to improve the resiliency of BC’s forest sector: • Immediately provide early retirement support for contractors in the Interior where timber supply has led to surplus capacity (i.e. making contractors whole on dispersals and harvesting rights/contracts). • Take another look at all of the 13 recommendations from the Contractor Sustainability Review to improve the overall competitiveness of both logging contractors and licensees. There is more to do than just fix the Timber Harvesting and Sub-Contractor Regulation. • Implement a strategy to encourage the full harvest of the allowable annual cut to help ensure there is enough fibre brought to market for those that need it. • Make adherence to forest policies such as utilization, cut control and log exports based on incentives to drive desired objectives, rather than simply applying penalties. • Increase certainty on the land base as currently it is increasingly uncertain. Stand firm on current levels of conservation. Our old-growth forests have been conserved and we will never run out. Invest in educating the public about forest stewardship and

start by giving our working forest protected status with no more reductions. • Acknowledge that a significant bottleneck in the forest sector, is the lack of suppport for First Nations' capacity and as such, dedicate resources to resolve this. • Invest in research; back up a desire for a value-added sector with serious investments in researching new forest products that support small to medium manufacturers. Drive research in technology that reduces our consumption of carbon rather than maintain a pointless carbon tax. • Seek federal support to invest in site productivity to accelerate rehabilitation of beetle-killed and wildfireburnt forest lands. • Review the Province’s tax regime, including PST on road building and logging trucks, and carbon tax etc. to attract investment capital rather than drive it away. • Support the contractor community’s future need for skilled workers by developing a training tax credit. • And finally, take on the elephant in the room and diversify the tenure. It is clear that the veil has come off of the major tenure holders’ commitment to BC (or diminishing lack thereof). End the master servant relationship that persists in the industry between major licensees and contractors by diversifying the tenure system with the addition of small to medium players including possible expansion of BCTS' sales and First Nations' tenures through another take back. Such action will likely resolve many other perennial conflicts that weigh on the sector like access to fibre and log exports. Create a true market for timber harvesting services rather than the oligopolistic one we have today. Market downturns don’t last forever. Let’s build a forest sector that is resilient and strong, and that provides prosperity for those that have invested their entire livelihoods into working in British Columbia’s forests. David Elstone, RPF, Executive Director, TLA Tel: 604-684-4291 ext. 1 Email: david@tla.ca


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Todd Chamberlain

Southern Interior PERSPECTIVE

Industry in Crisis

T

he summer of 2019 will undoubtedly be remembered as one of the worst summers for the BC forest industry. Low lumber prices combined with high stumpage rates has created what everyone keeps referring to as the “Perfect Storm.” This is a small consolation to the hundreds of affected workers, families and communities that rely on our industry to make a living, pay and collect taxes and contribute to the overall economy. The numbers are higher when you stop to consider the subsidiary employment that our industry creates through equipment manufacturers and all the other suppliers that it takes to keep the contracting communities moving.

the “blame game” and work together to find both short- and long-term solutions to get the industry through this difficult time. The ILA has been working with government and the opposition to make sure solutions are being investigated and implemented as soon as possible. We know that we won’t be able to get everyone back to work in the short term and even in the long term things will look different as annual allowable cuts decline, but it’s our goal to ensure that those who are able to withstand the storm are sustainable through the coming years. This past year, all of the associations have been collectively engaged with

I encourage all contractors whether you are a member of an association or independent, to use every opportunity to ensure that the people of this province understand exactly how much of a contribution you make to not only the economy but also to the sustainability of the working forest land base. Throughout this downturn, I have spoken to many contractors regarding their situation about how they are handling the social and financial burden of not having work for weeks and even months. Most of them simply say, “well, you know how it is, we will get through it.” Truth be told, I don’t know how it is, but I do know that they all deserve better than what they’ve been getting. The forest industry generates millions of dollars in revenues for the provincial government every year and now more than ever contractors in BC need government to recognize this contribution and do everything in their power to assist them through these difficult times. The opposition party has done a good job of travelling the province and getting out to affected communities to listen, but unfortunately listening is all they are capable of doing. Now is the time for all political parties to stop playing

10 Truck LoggerBC Fall 2019

government on the Contractor Sustainability Review. This summer has clearly re-emphasized why now, more than ever, this process results in a favourable outcome for contractors. This current situation is also compounding an already difficult situation. Aging workforce and a lack of interest by the younger generation has caused a shortage of skilled labour in the forest industry. Employees are now having to look at other employment opportunities to survive and some are having to leave the communities that they have called home for many years. There is a strong sense from employers that once our industry starts to recover, they may not be able to fill the seats with skilled people in order to resume operations. Government has also begun engagement sessions across the province for the Interior Forest Renewal Initiative, a process similar to the recently completed

Coast Forest Sector Revitalization. We have been encouraging our membership to attend these sessions, if for nothing else than to educate those involved on how certain solutions can and will affect the contractors. Full utilization either on the roadside or at the landing is something that should be carried out, but it needs to be realized that this is a cost that is borne by the contractor, which has to be recognized and compensated for. It has been positive to see so many stakeholders and different levels of government gather to discuss the issues and the hope is that it yields some positive results. If we learned anything from the process during the caribou recovery sessions this spring, it’s how important it is that those of us who are directly affected by land use decisions make sure we continue to try to be part of the solution moving forward. The ILA will continue to actively work on behalf of our membership to ensure that their concerns are heard and addressed. I encourage all contractors whether you are a member of an association or independent, to use every opportunity to ensure that the people of this Province understand exactly how much of a contribution you make to not only the economy but also to the sustainability of the working forest land base. Todd Chamberlain, RFT, General Manager, ILA Tel: 250-503-2199 Email: todd@interiorlogging.org


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Trevor Jobb

North West PERSPECTIVE

Waiting for Provincial Permits

T

he loggers and road builders of the Northwest are a vital contributor to the resource development that is happening here in the north. In addition to the forestry industry, the harvesting sector contractor force provides services as the first step in developing any project by removing and clearing trees for industrial and infrastructure development. The economic engine of the Province requires that permits are issued in a timely manner so that the development of resources occurs, and that the revenue is provided back to the crown from those activities. How many times have we heard about delays in a project due to permits not being issued? The delays can be for multiple reasons that range from incomplete submissions from submitting proponents, First Nations consultation processes, and bureaucratic processes. The most common reason heard from government personnel is that the staff levels of those who process and issue permits are under-resourced. There is not enough time in a day to process what needs to be done. This is troubling and is a drain on industries’ and even local government regional districts’ and municipalities’ ability to commence projects. If we take timber harvesting as an example, the recently delivered log cost analysis for our region puts the average cost to deliver logs to market at $85.00 per cubic metre. For the average 15,000 cubic metre cutblock, that equates to $1.275 million in economic activity for our communities and the Province. The government instantly has revenue coming back in the form of corporate, personal and excise taxes. If there is a 20 per cent rate of return to the government on that economic activity, that’s $255,000. The money is even greater when you consider the additional opportunity of further economic activity that those trees provide in the form of

wood manufacturing, or the initiation of development projects such as LNG. What a great business model the government has: issue the regulatory permits, sit back and watch the money roll in. That in itself, should motivate the most hardened of all bureaucrats.

on this process for over two years without results. Secondly, there is a need to properly resource tenures personnel so that surges in permit submission are recognized, and staff are reallocated to deal with those surges.

The Contractor Sustainability Review identified permitting as an Achilles heel to the profitability of our members. We need this fixed where loggers and road builders, forest licensees and communities ... are not “waiting for permits” but going to work. It is befuddling why the provincial government creates self-induced layers for permit submissions, thus creating more work for an understaffed workforce. By example, a Licence of Occupation tenure for an activity such as industrial development on crown land, also requires a parallel permitting process for an Occupant Licence to Cut permit. If the tenure has trees on the land and the purpose of the tenure is to develop that land, it is obvious that those trees will need to be cut and that there should not be two parallel permit submissions. There are many more examples of where efficiencies can be realized in the permitting processes, thus freeing up staff time to focus on getting more permits out the door. To do what we need to do in a time when many industries and services are experiencing worker shortages, let’s not create unnecessary work, slowing up development and draining the ability to be efficient and profitable for harvesting contractors and at the same time hindering economic activity. How do we fix what is broken? First of all, the permitting process needs to be streamlined to reduce redundancies. The government has recognized the system needs to be fixed and has been working (unfortunately independently)

No permits should be sitting on a desk for longer than a day more than what is needed. Much like a wildfire demands action be taken, there needs to be recognition that permits are important and that they need to be processed as quickly as possible. This can be done by paying employees overtime to process permits, reallocating current staff priorities, hiring more people, or better yet, have the private sector prepare the permits in a format that is shelf ready for the issuing authority to sign. The Contractor Sustainability Review identified permitting as an Achilles heel to the profitability of our members. It is also affecting the full potential of the province’s economic engine. We need this fixed where loggers and road builders, forest licensees and communities, (after all, it is all about communities) are not “waiting for permits” but going to work. Trevor Jobb, RPF, President, NWLA Tel: 250-638-0337 Email: tjobb@westlandresources.ca

Fall 2019 Truck LoggerBC 13


Paul Schuetz

Northern Interior PERSPECTIVE

Consequences of Sawmill Closures

O

n May 10, 2019 Tolko Industries announced the permanent closure of their Quest Wood sawmill in Quesnel. On June 3, Canfor announced the closure of their Vavenby Mill, and on June 17, West Fraser decided to shut the doors on their Chasm Mill. Conifex followed suit by announcing the closure and subsequent sale of their Fort St. James mill and curtailed their Mackenzie sawmill into September. Mill closures and curtailments have plagued the BC forest industry throughout the summer and the end does not appear to be in sight.

businesses operating in the community, companies that rely on the final product that these sawmills produce such as manufacturing plants, construction companies, lumber stores, etc., and companies that rely on the sawmill by-products such as pulp mills. The trickle-down effect of a mill closure is enormous and the intensity of the impact corresponds directly to the size of the local community and their reliance on that mill. Another significant consequence of a sawmill closure is the sudden decrease in sawmill by-products, or “sawmill residues,” such as sawdust, shav-

It is not just the mill workers that are feeling the full negative impact of these curtailments and closures. It is also felt by logging contractors and truck drivers, affiliated service companies, local businesses operating in the community, companies that rely on the final product that these sawmills produce ... and companies that rely on the sawmill by-products... In a Summer 2019 report by the Forest Economics Advisors (FEA) and Industrial Forestry Service Ltd. (IFS), it was stated that the number of sawmills in operation in the BC Interior has dropped from more than 95 in 2006 to 65 in 2018/2019, with a further drop predicted to 52 by 2028. This prediction represents nearly half of the operating sawmills from 13 years ago being shut down. Direct employment in the BC forest industry has also almost been cut in half, with over 100,000 jobs in the late 90s (based on Natural Resource Canada statistics) to just over 52,000 in 2017. And this number will have decreased further still, given all of the recent mill closures. It is not just the mill workers that are feeling the full negative impact of these curtailments and closures. It is also felt by logging contractors and truck drivers, affiliated service companies, local

14 Truck LoggerBC Fall 2019

ings and chips. Most sawmills have an agreement with nearby pulp mills, bioenergy plants, oriented strand board plants, pellet plants and co-generation plants to supply them with sawmill residues. However, with the closure of a sawmill, this supply chain gets cut, inevitably creating a demand to replace the residuals that were once supplied. To supplement the supply shortfall, the residual biomass industry has been constantly looking at ways to replenish sawmill residue shortfalls with other potential sources. One option is to harvest more marginal timber for use as pulp logs, that are eventually chipped on site or at processing yards and delivered to the mill for use as pulp/paper fibre. Another option is to increase the salvage of forest residues that are otherwise left behind in cutblocks and along roadsides. These post-harvest forest residues, that might

include treetops and butts, branches, deciduous, non-sawlog quality trees, etc., are scattered throughout the cutblock and/or piled by the roadside for burning. So, how will this change the future of harvesting and log hauling in the BC Interior? Apparently, forest industry managers and government officials are trying to work out the details as the Province undertakes the Interior Revitalization process. Salvaging sawlog waste from a cutblock is a good thing. Apart from meeting Coarse Woody Debris requirements, salvaging the remaining usable biomass will: • Maximize the value of the stand (licensee and government cost benefit) • Reduce the fire hazard (government cost benefit) • Improve site preparation conditions (licensee cost benefit) • Improve movement and safety conditions for tree planters, and therefore increase their productivity (licensee cost benefit) • Improve passibility for ungulates, including caribou While salvaging waste does have a lot of indirect benefits, it is the more ‘direct’ harvesting and hauling costs that drive this action. So, while forest industry managers and government officials work out the intricacies of salvaging forest residues, and how best to supplement sawmill residual shortfalls for pulp mills or bioenergy plants, who pays and who gets paid for the extra processing and handling that will inevitably be required, is central to any post-harvest residual plans. Contractors, like most everyone, believe in maximizing fibre usage, but as business owners, they are not willing to do this activity without compensation. Paul Schuetz, RPF, consultant to TLA Tel: 250-564-4115 Email: pschuetz@industrialforestry.ca


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Business MATTERS

Chris Duncan

Strategies to Manage Your Business’ Cashflow

G

iven the current situation and the financial challenges often faced within the forest industry, many business owners wonder what they should be doing with their cash in the bank. A common question I get from clients is—who should I pay first? Cashflow is tricky and should always be a focus of strong business management. Who should I pay first? When cash is tight who should you pay? A business’ first priority is to keep the equipment going; without that your cashflow ceases. Most contractors know you need to pay your fuel, wages and equipment payments before anything else. These are the big three of any contracting business. Owners also need to be aware of which commitments are guaranteed personally and the impact of the business’ debts should they default. If you have personally guaranteed the debt and your company defaults, you will be required to cover it with personal assets. This can create a situation where you are required to sell personal assets to pay corporate debts. Defaulting on this type of debt can affect your personal credit as well. If you do not have a personal guarantee on the debt, then your business may be able to default with minimal effects on your personal finances. Canada Revenue Agency If you are going to rank your creditors in order to pay, Canada Revenue Agency (CRA) is one of the most important. CRA has the authority to freeze your accounts and withdraw funds. They will not ask before withdrawing and can cause serious cashflow issues should you be in arrears. They can also direct your customers to pay CRA directly any money they owe your company for services rendered. Also, certain CRA debts such as GST and payroll remittances are considered to be money held in trust for the government. As such, should a business default on these remittances the debts may be

assumed by the directors of the business. They need to be treated the same as the big three business expenses. Cashflow management tips There are some simple strategies to create a better cashflow in your business: Invoicing: invoice your customer as soon as possible. I commonly see where contractors miss invoicing at the end of a customer’s cut-off period and end up waiting for payment until the next cut off. This results in a longer wait for your cash. Also, a short invoicing cycle is important when considering the Forestry Service Providers Compensation Fund if your licensee ever goes insolvent. Extend your payments to suppliers: while you want to remain current with your suppliers, paying too quickly puts unnecessary strain on your cashflow. Pay based on their terms; if they request payment within 30 days, don’t pay in 15, wait the full 30 days instead. Prepare a monthly cashflow projection: by planning ahead you are able to predict cash shortages and prepare for them. By projecting your cash needs you can align them with your debt obligations and get options such as skipping payments in the right period. Create a cash reserve: ideally a contractor should try to maintain one to three months of working cash on hand to cover unexpected needs such as a customer who doesn’t pay or bad weather. Manage growth: gearing up can always be a tricky time in a contractor’s business cycle. Upfront costs can use up cash at an alarming pace while new cash has yet to come in. Plan your growth and project what your cash needs will be to obtain the growth you want.

your payments all have significant impacts on your business’ cashflow. The shorter the term, the quicker you will be required to pay off the purchase price. By lengthening the term of your purchase, you can decrease the monthly cash requirements of the business, but may mean more interest is paid over the life of the loan. Timing your skipped payments is always a tricky maneuver. Mother Nature is hard to predict. Try to base skipped payment timing on your past experience of working in the areas you plan to log. This is further complicated when you are financing the equipment over five years but only have six to 12 months of logging planned. Down payments should be limited to the minimum required as large up-front payments can put unnecessary burdens on cashflow. The only time you may wish to put an additional payment down is to create a more stable and lower monthly payment. But if this is the case you need to consider if this equipment will earn enough to pay the monthly payment based on the minimum down payment. Major Expenditures While it is very tempting to consider a major rebuild or mechanical work when you're not working, it is not considered a wise investment if you don’t know when it will begin to generate cash flow again. Bottomline: Conserve your cash when you are not working. Chris Duncan, CPA, CA MNP Private Enterprise Group Tel: 250-748-3761 Email: chris.duncan@mnp.ca

Equipment purchases and cashflow Deciding on buying a new piece of gear is a regular occurrence in the industry. Most contractors consider the overall cost of the machine and the interest rates; however, only some consider the impact on cashflow. The length of the term, timing of

Fall 2019 Truck LoggerBC 17


Budd Phillips

Safety REPORT

Forestry Operations: Who Does What?

F

orestry operations are complex workplaces. It’s not uncommon for forestry operations to have multiple employers, which can be problematic where safety is concerned. If the employers’ work is not coordinated or is poorly communicated across the site, workers can be exposed to an increased risk of serious injury or death. For example, without proper planning and scheduling, work areas can become overcrowded, resulting in “phase congestion,” which can impact productivity and worker safety. By employing effective “phase integration”—bringing together various phases of a forestry operation, such as hand falling, road building, log processing and loading— multi-employer worksites can be safer and more efficient.

Health and safety is the shared responsibility of all workplace parties that have an influence on how work is conducted. So, what are the roles and responsibilities for owners and employers when worksites have two or more employers? Owners The Workers Compensation Act defines “owner” broadly. In forestry operations, the owner is often a licensee, so that is how it will be referred to here. The licensee must ensure that all activities of the operation are planned and conducted in a manner consistent with the Act, Occupational Health and Safety Regulation and any applicable orders. This includes providing and maintaining the licensed land and premises in a manner that ensures the health and safe-

ty of people at or near the workplace, and providing the employers with proper information to identify safety hazards and then eliminate or minimize them. The licensee must ensure that the work being conducted is done without undue risk to workers. This would include when the work cannot be done in a conventional manner because the risk is too great. For example, when the work is along a steep cliff where a fall would result in injury or death; or when licensees deactivate worksite roads, impeding future access for silviculture workers and potentially making it harder to evacuate an injured worker. The licensee can designate a prime contractor in a written agreement. The prime contractor should be clearly designated, qualified, and have the authority to fulfill the role’s responsibilities,

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including having authority over any employer, worker or other person who may be carrying out the licensee’s work at the workplace. In the absence of a written agreement, the licensee is responsible for these tasks. The licensee is responsible for ensuring that the prime contractor system is working, and if unsafe conditions or actions are seen on-site, the licensee must address them with the prime contractor. Employers Employers are responsible for ensuring healthy and safe workplaces for their own workers and any other workers at a site where that employer’s work is being carried out. Employers need to know how the work activities are being coordinated, and cooperate with the coordination of worksite activities, as well as provide the prime contractor with the name of the person designated to supervise that employer’s workers. Employers are required to make their workers aware of all safety hazards they’re likely to be exposed to, regularly inspect the worksite, and fix any site conditions

that are hazardous to their workers. Employers must ensure that the worksite has appropriate first aid equipment, supplies and trained attendants. Employers must establish valid occupational health and safety policies and programs, train workers to do their work safely and provide proper supervision, including training and support for supervisors to carry out their duties. Overlapping obligations Parties at a workplace may have obligations that relate to more than one role (e.g. licensees and prime contractors are also employers and they must fulfill the obligations that come with both roles) and multiple parties may share the same obligations. Statutory responsibilities must be fulfilled. If they are not, an order may be issued by WorkSafeBC, even if another person has fulfilled the other party’s responsibilities. One party may be relieved of its responsibilities under the Act or regulations only if all three of the following requirements are met: • Another party who is subject to the same obligations complies with them;

• Simultaneous compliance by more

than one party would result in unnecessary duplication of effort and expense; • The health and safety of persons at the workplace would not be put at risk by the compliance of only one party. If the performance of the occupational health and safety duty by one party leaves health and safety risks that would be eliminated by others performing their duty, this requirement will not be met. While parties who have the same responsibility under the Act or regulations may agree amongst themselves on who should perform it, these agreements are not binding on WorkSafeBC, nor is any party’s compliance with the terms of such agreements. Budd Phillips is Manager, Prevention Field Services, at WorkSafeBC in Fort St. John

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Market REPORT

David Elstone

Another turn for the worse

T

his past summer had ideal timber harvesting conditions with not a lot of heat, just enough rain, and very few wildfires. Yet, there was minimal harvesting throughout the Province. The United Steelworkers (USW) and Western Forest Products (WFP) strike caused the shutdown of a large portion of the coast, while both Interfor and Mosaic shutdowns in August as a precautionary measure for wildfires and weak markets, followed by Interfor’s announcement in

well aware of. Industry data lags realtime data and mainly serves to confirm what many within the industry already know, but it also provides context by indicating the degree market conditions have changed. With this information, a business owner can make more informed decisions. Data reveals that the BC industry activity has been sliding back into some of the worst levels since the last major downturn in 2009-2010; this is even be-

Data reveals that the BC industry activity has been sliding back into some of the worst levels since the last major downturn in 2009-2010... September to close its Hammond sawmill. Forest products producers (e.g. lumber, oriented strand board and pulp) in the Interior announced curtailments, some of which were permanent due to a shrinking timber supply, while others were made temporarily due to claims of high fibre costs and low commodity prices. Across the Province, this left a lot of contractors and their workers idle, with little to do, and few alternatives. Industry data points to a significant recession in the BC forest products sector—a fact that many contractors and their suppliers have already become

fore the impact of the USW/WFP strike and a majority of the curtailments were captured in the data. The last major downturn in 20092010 was singularly driven by the massive slump in US lumber consumption which was caused by the implosion in US residential construction. However, this time there are many other variables at play. US housing starts are the best indicator of US lumber consumption, which went from a peak in 2005 of over two million to a low of 0.6 million in 2009. As of writing, US housing starts (a high of

1.2 million starts) have failed to recover back to their 50-year average high of 1.5 million starts. Underperformance notwithstanding, what is concerning is that US housing starts are actually starting to head downwards, with data in August showing overall starts down 1.8 per cent year-to-date and single-family starts off by 2.7 per cent year-to-date—not quite a free-fall yet. Such data is in contrast to the perceived image that the US economy is strong and growing and is not a good sign for the BC forest industry. BC lumber export trends reflect the connectivity of the provincial industry to international markets. Since 2016, BC softwood lumber exports have been slipping year after year. Based on the year-to-date trend of June 2019, BC’s exports of lumber could reach their lowest since 2010. The picture is mixed with demand from two of BC’s major export markets in decline: Japan and the US, while China is actually growing this year. Unfortunately, a decline in exports to the US is troubling for the BC lumber sector given they represent just over 60 per cent of lumber exports. While weak lumber prices are problematic, the 20 per cent duty on Canadian lumber exports specifically to the US makes that market less profitable. Despite all that we hear about rising tariffs as the US and China exchange salvos in the expanding trade war and the fractured relationship the Canadian government currently has with the Chinese government, it is somewhat surprising that BC exports to China, up until at least June data, are showing some growth. If the trend holds, 2019 will be the first increase following five years of retrenchment. Do international markets not want BC lumber or are declines in exports due to BC not being able to produce enough? The significance of a downward trend in BC lumber exports is reflected even more poignantly through BC lumber (Continued on page 48)

Fall 2019 Truck LoggerBC 21


Forestry Community: Port McNeill

Photo courtesy of Graham MacKay

By Robin Brunet

P

eople acquainted with Port McNeill’s long line of feisty civic leaders may be familiar with the following comment: “Small community voices need a seat at the table, because we feel the effects of legislative changes much more quickly than larger municipalities.”

22 Truck LoggerBC Fall 2019

But even Port NcNeill residents—and there are about 2,150 of them—may be forgiven for assuming the remark was made by their late, longtime Mayor Gerry Furney. In fact, it was voiced this year by current Mayor Gaby Wickstrom, who is as equally determined as her predecessor

was to prevent outsiders from charting the economic fate of her small but proud town. In July, Truck LoggerBC magazine found Wickstrom in typical fighting form. Once more, green groups were urging politicians to end old-growth


logging, and Victoria councillors were proposing climate change initiatives that critics argued would negatively impact forestry and the stumpage revenues ($60 million last year alone) earned by the Regional District of Mount Waddington, of which Port McNeill is a part.

Wickstrom said, “We enjoyed a good year in 2018 between collecting stumpage and generating revenue from our Community Forest, and yet when I attended an Association of Vancouver Island and Coastal Communities meeting in May, it was suggested that we need to

transition our logging industry. I asked, ‘What do you propose we transition to?’ And nobody could give me an answer.” Wickstrom is well aware that Furney spent most of the 1990s defending his community against urban activists and politicians who sought to unduly restrict

Fall 2019 Truck LoggerBC 23


resource industries, even though they are the lifeblood of many rural communities. She observes, “So now we have the younger generation harbouring the false notion that we devastate the forests, only this time they’re linking our activities to climate change. “Nothing is new, really. Twenty-four years ago, when I moved to Port McNeill, I conducted forestry tours and discussed our stringent codes and sustainable practices, and visitors from Europe said to me, ‘Back home we’re told that it’s nothing but rape and pillage here—yet we had to drive all day through forests to get to you!’” Wickstrom’s solution to the latest wave of onerous green activism is to plant herself in the midst of the action. “I’m a huge advocate of small community voices having a seat at the table, which is why I’m running for a seat on the Union of BC Municipalities as a small communities representative,” she says. “It’s also important to be on the region wide Climate Action Plan panel involving Vancouver Island communities. I was recently asked by one panel member, ‘What is your climate challenge in Port McNeill?’ And I replied, ‘Honestly, it’s larger cities. You have no idea the impact your policies will have on small communities.’” It is estimated that 55 per cent of logging in the Port McNeill area is old growth, which keeps residents gainfully employed by companies such as Western Forest Products (Woss), TimberWest, Interfor, and many others. The thriving North Island Community Forest has a total area of 2,390 hectares, “And it’s brought about $1.78 million into our community so far,” says Wickstrom, adding that the money has been put into a reserve to fund future infrastructure needs. “Moving ahead, our goal is to expand the Community Forest in conjunction with First Nations.” The community Wickstrom and her council are so determined to protect is a classic outcome of determined individuals battling the odds to literally develop something out of nothing. In the 1950s, workers were brought into Port McNeill by steamship twice a week from Vancouver, and most stayed only long enough to build up a stake before

24 Truck LoggerBC Fall 2019

departing. But people who loved the international flavour of the community such as Furney, who arrived in Port McNeill in 1956 and worked as a truck logger, saw promise in this part of the North Island—and remained. A six-member Chamber of Commerce was formed in 1961 to obtain government funding for civic development, and because there was no regard for protocol, chamber members were constantly concocting money-raising contests, media events, and shaming politicians into giving them money. Port McNeill families take pride in the fact they outgrew their logging-camp origins through sheer moxie, and the oldest residents remember the schemes Furney concocted to develop the community, including the time the combative Irishman sent Ottawa 100-foot-long telegrams wrapped around shillelaghs demanding money for a breakwater. Or when he flew Victoria reporters up to play ‘pothole golf ’ on his unpaved roads, winning national headlines and, eventually, blacktop with highway links. In 1966, Port McNeill was incorporated as a village, and throughout the 1970s the Pioneer Timber bunkhouses were phased out and permanent homes built. In 1982, Port McNeill became the first town in Canada incorporated under the new Canadian Constitution. Port McNeill residents have always retained the distinct sense that they have had to fight for every facility and service taken for granted in urban centres. Indeed, in the 1980s the town operated on a $400,000 annual budget, which meant that school running tracks and other amenities had to be built by volunteers. Local fundraising events have been another important tool: in the 1990s they enabled the Chamber to build a six-unit seniors’ home, after the town had been turned down for government subsidies. Given this history, it’s not surprising that Wickstrom looks forward to dispelling misinformation about the logging industry and showcasing just how resourceful, if vulnerable, towns such as hers are. “As various climate action meetings are scheduled, Port McNeill councillors and myself are constantly networking to disseminate our message

and create a united front against policies that would harm our livelihood,” she says. Wickstrom also champions any initiative that aims to inject new blood into the aging forestry workforce. “We entered into a collaboration with the BC Forest Safety Council and Vancouver Island University whereby VIU students come here to a harvesting environment and provide them with the foundation skills and knowledge required to work safely, productively, and sustainably,” she says. “This VIU accredited course tries to place students in the region upon graduation.” Also, as a forward-thinking civic leader Wickstrom is keen to pursue economic diversification. “Elements in our favour include affordable housing, a genuine rural lifestyle, and the fact that today many people can work anywhere provided the fibre-optic infrastructure meets all requirements—and ours does,” she says. “These factors have contributed to a recent influx of new residents, and we’re diversifying slowly but surely: mining exploration is happening in the region, and a new hotel and a brew pub is being built.” Wickstrom envisions a time in the foreseeable future where a strong logging base in Port McNeill is augmented by small tech companies and perhaps even a thriving craft retail industry (she and her councillors are also determining ways to expand tourism, which would support retail initiatives). Capping all of this is a plan to revitalize downtown Port McNeill. Wickstrom concludes, “Logging is our predominant industry for which we’re grateful and will continue to support. We’ve proven that anything can be done when there’s passion and we work together—and that’s why I’m excited by the future.”


By Greg Munden

R

ecently, Munden Ventures had the opportunity to pilot a newly developed log truck driver training program developed by industry for industry. The program was developed in response to a gap in Class 1 licensing and the competency required of a professional log truck driver, a shortage of qualified log truck drivers in BC, and an inability to properly train new entrants into the industry to operate consistently to an industry-set standard of professionalism, safety and performance. The development of this program was managed by the BC Forest Safety Council (BCFSC) with direction, content, technical input and support from members of the industry’s safety groups, namely the Log Truck Technical Advisory Committee (LTTAC) and the Trucking and Harvesting Advisory Group (TAG).

As a fourth-generation log hauling and forestry business based in Kamloops, our company has always strived to support industry initiatives, as well as innovate and give back when we can to an industry that has been good to our family. Like many log hauling companies in the industry, Munden has high standards for hiring drivers, typically requiring a minimum of three years of log hauling experience, a clean “N” driver’s abstract, good references and a history of loyalty to the previous companies that applicants have worked for. Michael, the son of one of Munden’s owner operators, wanted desperately to land a job hauling logs—just like his dad. He already had his Class 1 licence and was sporadically driving a vacuum truck. In the past, we would not have even considered hiring Michael. We’re too

busy to even consider figuring out how to properly train a young person, let alone having financial or staff resources to entertain the idea. New program allows taking on training new young truck drivers As a new member of the LTTAC, I was familiar with the program. Having the driver program available gave us the confidence (and the support and resources) we needed to take a chance on Michael. Trish Kohorst, the BC Forest Safety Council’s Transportation Manager, quickly arranged a meeting with Michael and his Dad, Scott (who would become Michael’s mentor), and Munden management to make sure they were prepared for the program and that we all understood our commitment.

Fall 2019 Truck LoggerBC 25

Photo courtesy of Greg Munden

Calling future log haulers


Trish explained the program is competency-based; not a pass or fail, but a measurement of meeting or not yet meeting the required outcomes of the program. The program required that we spend time with Michael to cover all of the fundamentals of log hauling which included safe work procedures, fit for work, hours of service, truck systems, configurations, and shop safety before entering the cab of a truck. Building irreplaceable knowledge before getting into the driving seat One valuable aspect of the program was to have Michael spend time in our shop with one of our red seal mechanics. Having unrestricted time thoroughly going through a truck with a knowledgeable person is often not made available to a driver during the “throw them the keys and get them out there” style of training our industry has done too much of. Although Michael had spent time around and driving trucks previously, he learned more in those few hours about truck systems than he had in all the time he previously spent in the trucking industry.

Competency Conversations are not one-offs Once we covered off all of the knowledge building of the log hauling industry, we repeated it over the course of the training, including “competency conversations,” which involves a conversation that can be led either by the driver’s mentor or someone helping with training. It is designed to have the trainee answer questions about the industry that have been covered during the knowledge building of the training. As with all parts of the training, reaching competency is the ability to demonstrate the knowledge and skills required by the industry multiple times in a variety of contexts. In this case, a trainee would be expected to successfully answer all questions in the competency conversation five times over the course of the training. Having industry mentors willing and able to give their time and pass on their knowledge to the next generation of professional log haulers is critical to this program. As it turns out, taking on the training of his son forced Scott to refamiliarize himself with a lot of things in the industry which he forgot he knew. It also caused

him to identify areas where he had developed shortcuts in doing his job, which I know most log haulers find over time and seem to get away with, until they don’t. Self-paced, self-styled training to best meet needs and assure competency The training program does not dictate the particulars of how the training is accomplished, or at what pace. There is a significant reliance on the expertise of the driver’s mentor to assess the progress of the trainee, the conditions and all other circumstances (length of day, cycle times, pressure from other trucks, etc.) and tailor the training to ensure the success of the trainee, and, most importantly, safety. Once again, the mandate is to conduct the training over a period of time and have the trainee demonstrate the outcome multiple times in a variety of contexts. As you would expect, Michael’s driving training started with simply being a passenger and observer. This gave him a great opportunity to watch his mentor handle various situations, and see the safe work procedures learned in the knowledge stages of the program work in practice. Everything from radio protocol, signage

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and loading/unloading procedures. Eventually, riding along led to empty driving. Empty driving led to loaded driving, and, ultimately, complete handling of the day with mentor oversight. Independent assessment is critical to ensuring success Thinking back to one of the main goals of the program development team, the independent assessor is mandated with ensuring the standards of the program are maintained and met. The independent assessor’s role is to spend a trip with the trainee and evaluate his/her competency using the attributes, skills and knowledge that a professional log truck driver needs to confidently display to be considered competent. This starts with the competency conversation, includes the pre-trip inspection and then a complete cycle, whereby the trainee must demonstrate each element of the training to the standard. Once again, there is no grade or pass or fail, only competent or not yet competent for each required element of the program. Successful completion of this program means Michael has displayed competency in every area and confirmed by independent verification.

I know Michael is proud, but I can also say that we are all proud of Michael for proving his competency in this final assessment and earning his endorsement as a Professional Log Truck Driver. Training took approximately two months every day from mid-October through mid-December. The bulk of his training was in-cab. We had our reservations about training a young person to become a professional driver, especially during one of the toughest times of the year, through almost every possible weather and road condition, with both on-highway and off-highway loads, on a tri- or quad-drive short log trailer unit, but I think it’s one of the best decisions we made. Keeping it real means it’s sustainable for industry and invaluable for the trainee Scott could have trained Michael through the summer in dry and relatively safe conditions and we could have restricted him to our easiest runs, on the shortest days, with the least pressure; but we didn’t. Scott’s truck stayed on his normal haul, in his normal position, hauling his regular loads. Michael saw the true

picture of hauling logs (other than 30-degree weather in dry conditions). He experienced a lot of the circumstances he will normally encounter in the industry and he learned a lot, in an organized, intentional and safe way. Time will tell if this was a success. In the meantime, the best measure is being confident enough to put Michael to work in this industry. When we started the training, we did not have a position available. As circumstances and chance would have it, an opportunity opened up just as Michael was completing his training. Michael is now part of our regular professional driver team and is pulling his weight, safely. I can honestly say that I am very confident in Michael’s abilities and the training that he has received. It is by far the most comprehensive training we have ever been a part of in developing a driver. Best of all, we have been able to transition a young, passionate person into the industry without simply passing along our driver shortage problem to another company. I think it’s a good first step. Training is serious business. It takes time, resources and an effort from many people and Michael and Scott will attest to it being incredibly rewarding.

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CONDITIONS CHANGE. BE PREPARED AND PLAN AHEAD. The safety of your employees is your responsibility, including when they’re behind the wheel. Take steps to reduce the increased risks they face during winter conditions. Download our free winter driving safety toolkit at ShiftIntoWinter.ca.

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I am committed to doing my small part in elevating the occupation of professional log truck driver to what it once was, and should still be where highly skilled and hard-working log truck drivers are respected for the challenging job they do, and to ensure there is a means for attracting and training the next generation of professional log haulers safely into the industry. As they say, “it takes a village” and I would highly encourage other log hauling businesses in the Province to consider training a young person using this program. I believe it will be as rewarding for you as it is for them. By October 2019, Michael will have been driving with Munden for a full year (including training time). His usual route hauls take him between Kamloops and 100 Mile House for West Fraser. “I would highly recommend this program to any new logging driver hoping to get into this industry,” says Michael. “It was even more special for me to go through this with my dad as my mentor; it has been more than I could hope for. I feel like I had the chance to learn about every aspect of the log hauling industry and spend as much time as I needed to be comfortable. Although I realize I will continue learning for years to come, this program has definitely given me the confidence to start my career safely and productively.” “I can tell you it was a pretty proud day for me when Michael went on his own with the Forest Safety Council Independent Assessor and I felt confident that he could handle himself as a professional log hauler,” says Scott. “It was great to have guidance through this program on all the aspects to train on, and the mentorship time was so valuable to the success of bringing Michael into the industry. His mother and I both sleep better at night knowing that he has received a high level of training and has the knowledge and tools to enjoy a long, safe career in the industry.” The Professional Log Truck Driver Program learning resources are available on BCFSC’s website. It will be piloted through 2020 and feedback will be collected and reviewed for content revisions and program updates. If you are interested in further information about the Program contact Trish Kohorst at tkohorst@bcforestsafe.org or at 1-877-741-1060.

28SIW_2019_EmpLogging_4.75x10.0625.indd Truck LoggerBC Fall 2019

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2019-08-27 3:53 PM


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PROGRAM HIGHLIGHTS Hot Topics • Coast and Interior Issues • Log Exports • Utilization in the Woods • The Working Forest • Forest Products Market Outlook • Mental Health • Business Tools and Tips • First Nations Capacity

30 Truck LoggerBC Fall 2019

Annual Favourites • President’s Welcome Reception • Leaders’ Luncheon • Loggers’ Dinner and Comedy Theatre • Industry Trade Show • Partner Event • Lunch on the Trade Show Floor • Suppliers’ Night • Live and Silent Auctions


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By Paul Schuetz

I

n spring 2019, the BC and federal governments unveiled their strategy to recover and protect dwindling southern mountain caribou populations through two draft agreements. The “Caribou Recovery Plan” consisted of the draft Section 11 Agreement developed under the Species at Risk Act by the provincial and federal government, and the Draft Partnership Agreement between Canada, BC, West Moberly First Nation and Saulteau First Nation. The latter of these agreements proposed an interim moratorium on all new industrial activity in certain high caribou habitat areas located along the Rocky Mountain Trench between Mackenzie and Chetwynd (see map on page 34). The proposal was not met favourably by local residents in BC, and it became apparent very early on that those involved in the drafting of the Partnership Agreement failed to properly communicate their intentions to the public. In an attempt to remedy the situation, in early April 2019 a series of information meetings were held in various locations throughout the BC Interior to inform the public of the contents of the agreement and to acquire feedback from affected interest groups that operate or recreate in the caribou population units identified in the plans. As was quickly apparent, the public response to these meetings was much larger and more passionate than expected as concerned residents filled the auditoriums to capacity. On April 15, 2019, Premier John Horgan announced the appointment of the former BC Minister of Transportation and Infrastructure, Blair Lekstrom to identify problems in the Draft Partnership Agreement (PA) and to offer recommendations that would address many of the issues that were presented by the public at the information meetings. On June 20, 2019 Mr. Lekstrom published his report entitled “The Path Forward to Recover The Caribou Plan in Northern British Columbia.” Generally speaking, the intention of the two draft agreements was to provide a basis upon which steps could be taken toward the recovery of southern mountain caribou populations in BC. The reports suggest that the main contributors to the decline

Fall 2019 Truck LoggerBC 33

Photo: iStock

Recovering Caribou: Analysis of the Blair Lekstrom Report


in their populations included habitat loss due to industrial activity (including forestry, mining, hydro, and oil/gas activities), disturbance due to outdoor recreation (including snowmobiling and heli-skiing), and predation from wolves and bears. These issues were the main topics of discussion at the information meetings, as members from the resource sector, outdoor recreation clubs, the hunting community and concerned citiMap courtesy of the Province of BC

34 Truck LoggerBC Fall 2019

zens arrived in large numbers to voice their opinions. During the public information meetings, it became abundantly clear that an obvious shortfall of the original draft agreements was their lack of consultation and engagement with local communities, resource users and other interest groups. As Lekstrom puts it, “by excluding the vast majority of those who live, work and recreate in the region,

the process was headed for failure.” So, Lekstrom begins his report by not only identifying many of the problems and shortfalls with the draft agreements, but the Species at Risk Act itself, which does not make provisions for Socio-Economic Impact Analysis written into the legislature. Lekstrom calls this a “glaring omission” and it is raised later in his report as the final recommendation for improvements to the plan.


With lack of proper consultation and public involvement as the root of the problem, Lekstrom commenced his assignment by undertaking what the original authors of the Draft Partnership Agreement failed to do: stakeholder engagement. He met with groups from forestry, mining, oil/gas, agriculture, guide outfitters, snowmobilers, First Nations, municipalities, and several community groups and organizations (interestingly, he was unable to secure a meeting with two of the original partners of the Draft Partnership Agreement: the West Moberly First Nation and Saulteau First Nation). Lekstrom’s findings identified a common theme amongst all interest groups: concern for the conservation of the caribou species, and more community involvement in the drafting of the plans. After meeting with industry leaders, Lekstrom notes that “all industry make it clear that they support the goal of caribou recovery and habitat protection and restoration but they want to be at the table and be part of the discussions to reach the solution.”

Lekstrom’s report concludes with the acknowledgement that the original process used in developing the Draft Partnership Agreement was “a mistake” that led to a “distrust” of the Agreement’s authors by various interest groups and local citizens. Lekstrom put forth 14 recommendations as a means to help remedy the situation and possibly allow the Province to move forward with

proper engagement has occurred with all interest groups. Engagement must be done in a manner that is inclusive, transparent and be given the time to achieve public support.” This recommendation addresses the core problem with the original Draft Partnership Agreement. Recommendation 2. “Ensure proper consultation with and possible inclusion of both McLeod Lake Indian Band and

All industry make it clear that they support the goal of caribou recovery and habitat protection and restoration but they want to be at the table and be part of the discussions to reach the solution. protection plans for caribou. Below are selected recommendations, with responses, most relevant to the TLA members and the forest industry as a whole (a link to the Lekstrom Report, including all 14 recommendations, can be found at https://engage.gov.bc.ca/ caribou/section11agreement/): Recommendation 1. “Government must not move forward until full and

Lheidli-T’enneh First Nation in the rebalanced Partnership Agreement.” Involving all affected First Nation communities is important, but so is involving representatives from industry and other interest groups. The original Draft Partnership Agreement was authored by members of government and the West Moberly and Saulteau First Nations. To ensure inclusiveness, perhaps other interest group Photo courtesy of Paul Schuetz

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representatives should take direct involvement in the process. Recommendation 3. “A comprehensive Socio-Economic Impact Analysis must be completed in cooperation with the impacted areas of the Partnership Agreement prior to the agreement being finalized.” This is an important recommendation, as it will consider the eco-

A2 and B3 represent a Timber Harvesting Land Base (THLB) of about 32,000 ha and 42,000 ha respectively, with no discussion on how long the moratorium would last. Temporarily removing this area from the THLB presents a problem with not just forest planning, but planning other industry processes such as mineral extraction and oil/gas pipelines.

It is agreed that caribou management should become much more stringent ... but if the government insists on a moratorium, why is industry being singled out? nomic effect the plan will have on industry. For example, the current state of the forest industry must be taken into consideration, and how the timing of this plan will affect forestry jobs. Recommendation 4. “Recognizing that it will take time to rebalance the Partnership Agreement and ensure the document can be more fully accepted and supported by the region, impose a temporary moratorium on Zones A2 and B3 until a comprehensive engagement process is complete and all possible options are considered.” Zones

In the original Draft Partnership Agreement, the proposed moratorium targeted “New Industrial and Commercial Development Proposals,” inferring that industry is the principal culprit to why the caribou herds are dwindling. It is agreed that caribou management should become much more stringent in these areas (e.g. selective harvesting, directing harvesting activities to when caribou are not present), but if the government insists on a moratorium, why is industry being singled out? If other ‘potential’

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activities are also detrimental to caribou and/or their habitat, such as recreation, aircraft, etc., why are they excluded? Recommendation 5. “The government needs to work with the Forest Industry to identify ways to mitigate any negative impact on volume from the deferral zones. Through discussion this may then ensure AAC is made available from adjacent units.” Lekstrom is recommending that the plans should avoid disrupting the AAC. At a time when AAC reductions are commonplace for other reasons, this recommendation would help reduce the overall impact on the forest industry. One suggestion might be to designate caribou deferral zones as Old Growth Management Areas (OGMAs), and replace lost THLB area with existing OGMAs within the Timber Supply Area. This practice would be particularly effective in permanent OGMAs that have forest health concerns. Recommendation 6. “Moving forward remove Zones B2 (Klinze-sa park expansion) and B5 (proposed West Moberly First Nations Woodland Licence) from the Partnership Agreement

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as both of these issues were agreed to prior to the development of the PA. If the province moves forward with a Woodlands licence for West Moberly First Nations the requirement to harvest that timber must be actioned or the licence should not proceed.” This recommendation makes sense as a First Nation Woodland licence will provide employment for the town of Chetwynd, one of the communities most affected by the moratorium. The licence would also help by providing fibre to nearby mills. Recommendation 13. “The Federal Government must accept responsibility for the costs associated with any mitigation measures which may be needed to offset any negative impacts the final agreements may have on communities, industry, back country user groups and individual workers who may be negatively impacted. This recommendation reflects the fact that it is the Federal Governments Species at Risk Act which has led to the development of both the Section 11 Bilateral Agreement and the Draft Partnership Agreement.” This is an excellent recommendation and a good

point that Lekstrom makes, in that it is a Federal issue that is adversely affecting local people. The question is: how long will it take to be compensated and will the damage already be done in terms of job losses, etc.? Recommendation 14. “Although not within the jurisdiction of the provincial government, I would recommend that the Federal government incorporate the need for a full and comprehensive SocioEconomic Impact Analysis be part of all at risk species deliberations under the act and such a section be included in an amended Federal Species at Risk legislation.” This is also a good idea, and perhaps this Caribou Recovery program can later serve as a template for similar programs in the future. All in all, the Blair Lekstrom Report does a good job of reporting on the deficiencies of the original Draft Partnership Agreement. The Report manages to give reasonable recommendations on how to move forward with a revised version. Recommendation #4 is still the most unsettling as it still appears that industry is being blamed for the

destruction of Caribou habitat, and that an interim moratorium should still be imposed. Nothing has been said about the effect that the mountain pine beetle has had on the habitat of the southern mountain caribou herds, nor how forestry has made strides in alleviating the devastation by salvaging the affected areas and replanting pine stands that will soon become desirable habitat once again. Despite going ahead with the moratorium area, Lekstrom has favourably addressed the issue in recommendations 5 and 13, by suggesting replacement of lost THLB, perhaps with adjacent old growth management areas, and potentially being compensated by the Federal government for “negative impacts the final agreements may have.” These recommendations are encouraging, but it remains to be seen whether or not government will implement the ones that benefit both caribou and people.

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Managing for First Nations Cultural Values

By Ian MacNeill

S

ilviculture has come a long way in British Columbia. Long gone are the days when sidehills were striplogged and left to degrade into barren rock under the corrosive impact of wind and water. On average, 80 per cent of harvested land is replanted annually (the balance is maintained through natural regeneration), and an estimated 218 million seedlings go into the ground. It’s a crucial component of BC’s long-term forest sustainability strategy; harvesting of second-growth forests already represents about half of the allowable annual cut, and that share will increase in the coming decades. But while replanting trees is definitely a good thing, says Jim McGrath natural resources manager for the Kamloops Indian Band, current practices aren’t always enough to return forests to their former ecologically balanced state, at least in terms of Indigenous values. And when you understand the values he’s talking about, it’s easy to see that instilling them would not only serve the interests of British ColumPhoto: iStock

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bia’s First Nations people, but of anyone who believes in the long-term cultural, economic, and recreational value of BC forests. It helps to start with the long view. Since time immemorial, and before the arrival of industrial harvesting, forests grew, got old, and eventually died. The normal process of regeneration was fire, which created a clean slate and a nutrient-rich environment for nature to develop the kind of diversified old-growth forests we see today, which don’t just contain commercial grade soft woods, but a wide variety of bushes and shrubs that helped sustain the diets and habitat of both humans and animals. However, the regeneration process that follows clear-cut harvesting tends to create a different kind of forest, one that tends to be lacking in berry-producing bushes and shrubs. Similarly, planting conifers alone deprives animals like the moose of one of its most important food sources, willow. “People and animals don’t eat pine trees,” says McGrath, “They eat berries and the deer that feed off them.”

This conclusion about insufficient diversity is based on science as well as First Nations observation. McGrath points to an SFU study that compared forest regrowth following timber harvesting and fires. The report concluded that post-fire forests were more diversified. “In a cutblock there is a bit of disturbance and you just don’t get all the shrub species,” he says. This is not an irresolvable problem, and it does not involve using fire as a more widespread management technique, which wouldn’t fly anyway. The solution is to take a more diversified approach to replanting. Don’t just introduce conifer seedlings, but mix in important shrubs like Saskatoon berry, huckleberry, and soopolallie, or soapberry, which is not only an edible, albeit a bitter one, but has been used for generations in Native communities to treat high blood pressure, digestive disorders, acne, and to bring on childbirth. Similarly, when decommissioning roads, McGrath would prefer to see them sowed with willow plugs,


an important food source for moose. And there’s more to it than just planting, he adds. Managing according to Indigenous values might include keeping a road open in order to provide access for hunters, or closing one down where there’s too much traffic. It might also include setbacks, say for example to protect a spiritual bathing area. Every situation would be unique and require tailor-made solutions based on the environment and local values. Of course, this extra layer of management comes at a cost, and the question then becomes, who pays for it. According to Matt Wealick, chair of the TLA’s Aboriginal Affairs Committee, while licensees are often sympathetic to Indigenous values, they aren’t always willing to foot the bill for them. “Licensees are typically only interested in the economics of the deal,” says Wealick. “Cultural values tend to come fairly low on the list of priorities.” Plus, he adds, they are not obliged to take into consideration costs associated with cultural values, although they often do to promote goodwill. Similarly, it hardly seems fair to hand the bill entirely to First Nations. In addition to the intrinsic and economic values associated with having diversified forests that devolve to all British Columbians, they provide stumpage revenues that fund schools, roads, healthcare, and infrastructure projects, to name a few. The solution, says McGrath would be to share the costs among all beneficiaries, including Indigenous people, licensees, and the people of BC by making an allowance for cultural management in the rate of stumpage paid to the Province, and enshrining that allowance in the Coastal and Interior Appraisal Manuals. “Let’s say we allocate one dollar per cubic metre to fund cultural management practices,” he explains. “And let’s say the stumpage rate is $10 per cubic metre. If we could reduce that by one dollar the costs would be covered.” It’s a unique proposal, and one that has been met with support from at least one licensee. “It’s a really innovative proposal,” says Michael Bragg, Tolko’s woodlands manager of forestry in the Southern Interior, who works extensively with the Tk’emlúps te Secwépemc Band, located in the Kamloops area. He adds that Tolko is already doing what it can to incorporate Indigenous

cultural values in its cutblock planning, but admits that it can get complicated, and expensive. It typically starts with Indigenous field crews “spending time” determining what values there are in a given block through an office and field review, making recommendations to the companies that are proponents of the block, and then having the company field crews look for the opportunities to try to incorporate those values into their block-level plans. These plans are then put forward to the operational crew to implement, sometimes requiring the buncher to slow down and work around key features. He adds that if licensees could get better cost recognition for the work they are already doing, the work they would be willing to take on, and if more cultural management practices were implemented, “then there would probably be a lot more uptake from licensees.” An additional value-added benefit is that it would strengthen relations between licensees and their Indigenous partners. “Jim (McGrath) is definitely on to something,” he says. Matt Wealick adds that in terms of what the provincial government is try-

ing to achieve in terms of developing policy and legislation with respect to First Nations, it only makes sense. “The government is always trying to maximize revenues, and we understand that this goes against that,” he says, but adds that economic values are only part of the equation; incorporating Indigenous values now will pay dividends as more diversified forests grow to maturity. “It would give licensees an incentive to manage with respect to cultural values instead of them looking for reasons to not do it, and it allows the provincial government to live up to one of its stated goals, which is to develop policy in accordance with the UN Declaration on the Rights of Indigenous People (UNDRIP). It will be up to the Province to make the next move, but it is encouraging that Premier John Horgan has already stated that legislation bringing the Province into line with UNDRIP, which includes 46 articles meant to recognize the basic human rights of Indigenous Peoples along with their rights to selfdetermination, was going to be “more than symbolic.”

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Future Opportunities for Forestry Education By Adrienne Tanner

A

bout eight years ago, Virginia Dean, then a schoolteacher in Delta who often traipsed through the woods with her outdoorsy mother, signed up for a different type of forest excursion. She joined a group of about 20 BC teachers on a Festival of Forestry tour, an educational field trip for teachers focused on forest management. As a business teacher, Dean knew forestry was a vital piece of the BC economy. But she knew little about the workings of the industry and wanted to learn more. “My interest was twofold,” Dean says. “I have a mother who loves to go through forests and name plants. And I’d been teaching economics for about 16 years and wanted to learn more about the industry and how it affects our Province, economy and people.” The tour delivered. Dean’s group toured forestry-related sights on Vancouver Island in the Nanaimo and Parksville area. She’ll never forget suiting up in safety gear to visit a working sawmill. “We developed a real appreciation for the people who work in a sawmill because of what’s happening in there—the stuff flying around, the noise. I was very impressed with the amount of organization and safety precautions to make sure things were done properly.” Dean’s group learned about the pine beetle scourge and forest management; why clear cuts, although they look unAll photos courtesy of Jason Kerluck

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sightly, help with forest regeneration. When she returned to the classroom, she passed on what she had learned to her students. “Any time we were talking about natural resources and careers, it would come up. So definitely it was very helpful.” She also shared resources with her co-workers. The Festival of Forestry was started in 1967 by former Truck Loggers Association President Bill Moore. As a young logger, Moore recognized the public misperceptions, particularly among teachers, toward his industry. To help counter the misinformation, he formed a non-profit educational society along with partners from industry, education, unions and government. One of the society’s primary mandates was to educate teachers about BC forest management, says Festival of Forestry board member Sandy McKellar. The teacher education idea arose from attitudes encountered by log truck drivers when they entered big cities with their trucks, she says. “They felt like Vancouverites had no idea that this industry existed in the rural communities and supported so many of the jobs and social structure.” Moore believed if teachers were better educated, they would then share that knowledge with students and perceptions would change. Judging by surveys filled out by teachers both before and after the tours, the program is meeting its goal. For example,

in 2015, surveys were completed by 11 of the teachers before the tour, and 13 after. Pre-tour, the majority said they were not convinced that forestry was practised sustainably. At the end of the tour, all but one, who was not sure, had changed their minds. Most teachers who initially said they were only slightly or somewhat familiar with the forest products cycle ended up feeling moderately familiar. And after the tour all 13 teachers reported they now understand how harvesting areas are chosen, a switch from the three who first answered yes. Initially, the tours were open only to teachers from the big cities of Victoria and Vancouver, communities largely removed from the forestry industry. Today they reach further afield. “The logic behind that is even teachers in schools in Prince George and Kamloops and other communities where forestry is the predominant employer, often still have very little knowledge about what the forest industry is or how it supports their community,” McKellar says. That pretty much describes Adrian Pendergast, who as vice-principal at Port Hardy Secondary, started a forestry program at his school. “It’s hands down the biggest employer in the North Island. But we realized a lot of students planning on pursuing post-secondary (education) were not thinking of or even recognizing that forestry existed as an option.” The students had a narrow view of the industry. They talked about becoming fallers, machine operators and truck drivers, but were oblivious to some of the jobs that required a college diploma or university degree, Pendergast says. Starting a forestry program was a stretch for Pendergast, who has a biology background but had never worked in the industry. He leaned on industry partners for advice on what to teach and to provide students with work experience placements. The Truck Loggers Association gave a grant to help outfit students with the proper equipment—boots and high-visibility safety gear. The program is a big commitment for students; it is offered as an elective taken on top of other courses. So Pendergast knew it would have to be packed with interesting


hands-on experiences to garner interest. To his surprise, about half the students who have signed on for the course over the years have been female. The program was already planned when Pendergast went on a Festival of Forestry tour. “It was in the Lower Mainland when I did it and it gave me some other ideas of things we might do, even visiting a mill.” When his school forestry program began, he organized a field trip to the mill in Crofton so students could see where the North Island wood was going. “The Festival of Forestry helped me realize some of the partnerships that would be available. We went on tour, for instance, with a forester in Squamish and it wasn’t hard for me to see that same kind of activity could take place in Vancouver Island North.” Pendergast found his own experience so valuable he participated in planning a future festival. “And I went out with the teachers this time to give the perspective of how I had used some of the things I had seen, not just in a forestry program, but in a science class or tourism.”

Port Hardy’s school forestry program is just one of a number on Vancouver Island. Jason Kerluck runs a forestry course at Carihi Secondary in Campbell River that gives students a science and elective credit. He’s had his share of challenges filling the course, which runs for an entire afternoon for five months. “A lot of kids these days don’t necessarily want to put themselves in anything with uncertainty. And there’s a lot of negative association with forestry, even in Campbell River.” Kerluck should know. He has a forestry diploma and started out in the logging industry before earning a Master of Education degree. Kerluck is bullish on the forestry industry and believes there are huge opportunities in the field, particularly for Indigenous students from First Nations running forestry companies. And he’s now planning to bridge his school program with a new two-year forestry diploma program he helped design at Campbell River’s North Island College. Eventually, successful grads from the high-school program entering the college program will be credited with their first

semester toward a diploma, a huge savings for any student, Kerluck says. McKellar emphasizes the festival tours have just as much value for teachers with young students. McKellar once tagged along on a tour where an elementary teacher saw a logger cutting discs— known in the industry as cookies—off the end of a log. “She started envisioning all the different ways she could use that to teach math. To teach the science of a circle, the diameter, radius and circumference and also at the same time talk about the growth rings.” The logger got so excited that he cut her a set of cookies to carry home. Lower Mainland teachers can spin what they learn on the tours into interesting field trips for their students. And it’s those young students the festival wants most to reach. By the time kids reach high school, a lot of them have formed strong opinions about forestry and already made a career choice, McKellar notes. “The younger kids are still open.”

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Photo: iStock

What is Old Growth?

By Jean Sorensen

T

wenty-five years after the War in the Woods, the new arguments are no longer solely about old-growth stem size or picturesque stands of old trees; they have morphed into how old-growth forests are protecting BC's unique biodiversity. BC has made significant strides in old-growth preservation in parks, wildlife areas, watershed and dedicated Old Growth Management Areas (OGMAs) within harvesting plans. As many as 55,000 OGMAs exist as part of a 1990s biodiversity plan. Best accumulative figures available suggest OGMA hectares stands rival Greece's total arable land base while current estimates of old-growth hectares in all protected areas are about the size of Hungary's agricultural land base.

42 Truck LoggerBC Fall 2019

BC divides into 14 biogeoclimatic regions, all with vegetation, trees, birds and animals characterizing each area. Forest planners are charged by law to preserve biodiversity traits when planning timber harvesting in any of these regions. The 1995 Biodiversity Guidebook and 1999 Landscape Unit Planning Guide (LUPG), both issued by the BC government, set out guidelines for preserving diversity. BC's Land Act sets out legal OGMAs, while the Forest and Range Practices Act (FRPA) sets out a list of considerations ranging from fish to old growth that forest planners must consider when making a forest stewardship plan (FSP). Targets for old-growth retention in OGMAs are set out in the LUPG, and hinged upon varying factors such as cut

size, ecological sensitivity of the area, and other conditions. The percentages of old-growth retention targets varied up to 70 per cent (in sensitive ecological sites), according to an investigative 2012 OGMA report by the watch-dog Forest Practices Board entitled Conserving Old Growth Forests in BC. Today, the figures provided to Truck LoggerBC magazine by the BC government has 1.8 million hectares of legal OGMAs throughout BC. (Legal OGMAs are established by ministerial order on a harvest plan to meet diversity targets). Draft or non-legal OGMAs cover a further 783,000 hectares with that figure inclusive of 148,000 ha of old growth that meet the age category, according to Brian Bawtinheimer, executive director for the


Province's land use planning, resource stewardship division. (Draft or non-legal OGMAs can be either ministerial order, or areas awaiting ministerial order, areas volunteered into company FSPs but can also include stands that are considered old but don't meet the old-growth age requirement but still have biodiversity characteristics; while not official they are still typically managed as OGMAs). In total, those figures combined set aside 2.58 million hectares of BC's old or old-growth forest lands in just one preservation tool. (By comparison, Greece has 2.6 million hectares of agricultural land). The latest PwC report for COFI cites figures of 55 million hectares of forested land in BC of which 22 million are available for harvesting.

BC government statistics state that "40 per cent of BC’s forests are considered old growth while the proportion is higher in the coastal rainforest, where it’s about 55 per cent of the forest." On Vancouver Island, 520,000 hectares (the size of Prince Edward Island) or twothirds of the old growth is already in protected areas. (A straight-line hectare comparison has OGMA reserves at approximately 10 per cent, the size of BC's entire harvestable land base). "OGMAs give a portion of the picture, but not all the picture," says Bawtinheimer, adding BC is crunching new numbers to refine the tally of how much total old growth—found throughout BC—really exists. Old-growth stands were captured by aerial mapping but

Bawtinheimer says the common practice, for example, was to stop at a park boundary. Old growth occurs in parks, protected areas, federal lands, private lands, areas outside the Timber Harvest Land Base, and in other land management designations established for wildlife or biodiversity. The new tallies on old-growth forests will help BC's new two-man inquiry Al Gorley, former head of the Forest Practices Board, and Garry Merkel, RPF, look at some of the issues facing old growth in BC. The pair will meet with stakeholders before tendering a report on old-growth forests in early 2020 to government with recommendations. As BC crunches new numbers, previous government information released in

Fall 2019 Truck LoggerBC 43


April 2016, when the oil and gas industry was required also to establish OGMAs, estimated BC's old-growth tally at 3.1 million hectares in 49,000 OGMAs. The release also cited 4.5 million hectares of old growth in all protected areas. (By comparison, Hungary has approximately 4.6 million hectares in agricultural land). In an email, Bawtinheimer said the numbers on OGMAs change as fires and other natural disturbances require replacing stands. Also in previous years the method of tallying the amount of old growth changed, making year-to-year comparisons not possible. "Estimations change based on data sources so comparing 2012 or 2016 with 2019 will not always make mathematical sense given different sources of information, methodologies, estimated verses verified data etc.," he said, adding updated figures hopefully released by mid-September can't be compared either. Large new parks such as the Great Bear Rainforest (GBR) have also been created. GBR covers 6.4 million hectares, a land base equal to the size of Ireland. Within the GBR, 85 per cent of the area (old growth and second growth) are

excluded from logging. More recently, a new caribou protection plan could take 300,000 cubic metres of timber from the Interior AAC. For individuals such as Vancouver Island third-generation contract logger Dorian Uzzell, president of Wahkash Logging, who harvests old growth at the end of northern Vancouver Island, the continued debate leading to erosion of the working forest has dragged on far too long. He wants that one-third of old-growth working forest left for logging. "Over the years we have worked diligently to set aside thousands and thousands of acres of old-growth timber in every watershed, on mountains and in areas where most people will never go to look," he says. "We are also stewards of the forest," says Uzzell of those who work in the woods and live in rural resource communities. "The amount we log is sustainable year after year," he says, but if pressure groups such as the Green Party and environmentalists continue to lead to more reserves or a moratorium on oldgrowth logging, it will have a massive effect on people and the community.

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Glass half full or half empty? So what fuels the public debate decades after War in the Woods? The main difficulty with old growth is how one sees it. "Definition depends upon the perception," says Mike Larock, RPF, director of professional practice and policy and forest stewardship for the BC Association of Professional Foresters. Larock says professional foresters use a descriptive definition of an old-growth forest using age and characteristic (multilayered canopy, varying age classes and stem sizes, and ground debris). "The old growth term was simply used for inventory for foresters and traditionally in the industry. We are using the inventory label for any stands for forests that were more than 250 years (on the Coast and 140 plus years in the Interior)." These stands were deemed more difficult to harvest because of mixed stem sizes and dead and dying trees. However, the same characteristics are not exclusive to old-growth stands, he points out, and foresters can even create these stand attributes through management. BC’s definition leans heavily on age with some characteristics defined. Information from the Ministry of Forests, Lands, Natural Resource Operations and Rural Development provided to Truck LoggerBC magazine states: "BC’s coastal forests are considered old growth if trees are more than 250 years old. In the Interior, where trees have a shorter lifespan and wildfires are more common, old growth is defined as more than 120 years of age for forests dominated by lodgepole pine or broadleaf species, and more than 140 years for all other forests such as Englemann spruce, white spruce and Interior Douglas-fir." The ministry added that "further refinement of old growth is based on frequency of natural disturbance, the biogeoclimatic zone and species." Missing is a universal definition. "You won't find one," says UBC's Faculty of Forestry Dean Dr. John Innes, in the search for a common old-growth definition. The defining traits are interwoven in a swath of growth conditions. In the US, different states have differing definitions, he says. So, the basic fallback becomes age and that's a wobbly platform. Innes says age doesn't capture true information. While 250-year-old trees conjure up images of large diameter


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Fall 2019 Truck LoggerBC 45


trees, there exists in BC and across Canada stands of small diameter trees on poor growing sites that are also hundreds of years old. In a 2008 discussion paper 'Defining old growth and recovering old growth on the coast', authors Rachel Holt, Karen Price, Laurie Kremsater, A. MacKinnon, K. Lertzman point out the difficulties in defining old-growth forests using age. "The age group of 250 years and above is also a practical limit: it is a standard age class used on forest cover maps and it is often difficult to measure the actual age of trees much older than 250 years accurately," the authors said. Coastal inventory maps were readily available and "they allowed identification of old growth based on existing data without the expense of field sampling." Mapping demographics are flawed, according to the authors. "Forest cover age class data are often incorrect and may systematically misclassify age for certain forest types," the authors said. On one end it doesn't capture old growth on low productivity sites and at the other end it can't separate out stands beyond 250 plus years.

BC has made headway in separating old-growth trees from old-growth forests. BC Timber Sales (BCTS) has identified legacy trees are exceptionally old and large, creating a reserve around them that can help bridge forest cover transition to second growth. The BCTS' coastal legacy trees have a specific breast diameter height: yellow cedar 2.1 metres, Western Red Cedar 3 m, Coastal Douglas Fir 2.1 m, and Sitka Spruce 2.2 m. Legacy trees can also contain monumental cedars (used for canoe making), cultural cedars and culturally modified trees (all having First Nations significance) and are protected under various legislation. The Big Tree registry at UBC records some of BC's largest tree giants, although specific age is not known as there is no accurate non-destructive measuring means. Other jurisdictions have gone further. The Food and Agriculture Organization of the United Nations (FAO) describes primary forests, rather than old-growth forest or using age. Primary forests are naturally regenerated forest of native tree species, where there is no clearly visible indication of human

activities and ecological processes are not significantly disturbed, states the FAO's Global Forest Resources Assessment 2020 working paper. Ancient forest is another term often used in describing old growth, but some jurisdictions have narrowed it to mean forests known to exist on a site for thousands of years. In the UK, ancient woodlots are continuous growing forests dating back to the 1600s. Innes says the Society of American Foresters’ definition is probably as good as any. It defines old-growth forests in a descriptive way that doesn't hinge upon ages. The Society's definition is simply "the (usually) late successional stage of forest development" in its Dictionary of Forestry. But the devil is in the details of its six descriptive notes. The first states: "Old-growth forests are defined in many ways: generally, structural characteristic used to describe old-growth forests include (a) live trees: number and minimum size of both seral and climax dominates, (b) canopy conditions; commonly including multi-layering (c) snags: minimum number of specific size and (d) downed logs and coarse woody

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So, who are you calling old? BC's inventory classifications system using age bears little correlation to a tree's natural and possible lifespan, which can be impacted by natural disturbances. As the ministry information states, long-life species such as Western red cedar, yellow cedar and mountain hemlock stands can grow up to 1,000 2,000 years but are placed into the old growth category at one-quarter into their lifespan. Douglas fir (with a 500year lifespan on the Coast) is considered a senior citizen at mid-life. In the Interior, lodgepole pine stands survive to 125 to 150 years, but are classified

Photo courtesy of Simon Ellis

debris: minimum tonnage and number of pieces of specific size.� But it can also be broader as the definition's fourth note states: "due to large differences in forest types, climate, site quality, and natural disturbances history (e.g. fire, wind, and disease and insect epidemics), old-growth forests vary extensively in tree size, age classes, presences and abundance of structural elements, stability and presence of understorey."

as old growth at near the end of their routine life expectancy. The yardstick of 140 years also catches Englemann spruce (300-400 year lifespan), and Douglas fir (300 years) at mid-life. Kerry Rouck, RPF, and manager of corporate forestry and woodlands for Gorman Bros. in BC's Interior region says the 140-year designation of old growth is really only a "starting point". There is a difference in how long a tree can live and how often it is downed by natural disturbances. The Interior region has seen

flexibility in how trees are placed into the old-growth category with consideration given to known disturbances (fire, disease, infestations, and storms). "It can be 140 years, 180 years or 250 years," he says, as foresters learn more about the pattern of the natural disturbances intervals that travel through an area. Species such as lodgepole pine, a pioneer species, relies on fire disturbance for propagation as the fire causes their cones to open and release new seed on the burnt ground. Douglas fir and ponderosa Photo courtesy of TLA staff

Fall 2019 Truck LoggerBC 47


pine have extra thick bark able to protect the tree through some burns that take out competing trees. Mature and Juvenile Wood Where age matters is in fine wine and fine wood. Wood scientists don't use the term old growth and second growth (trees either naturally regenerated or replanted after logging). UBC's Simon Ellis, a wood scientist, explains that all trees have a combination of mature wood and juvenile wood. Younger trees have a greater percentage of juvenile wood, which is prone to longitudinal warp when drying and is not as strong as mature wood. "The hormone that drives the production of the growth is at the top of the tree," he says, as the top spurts toward sunlight."The tree grows at the top and leaves cells behind (new growth) but also grows outward leaving wood behind (growth rings)." The cambium layer (between the outside bark and the inside layer of wood) adds wood and is fed by the tree's inner bark layer carrying leaf nutrients downward. Ellis says that the vigorous growth topside usually grabs nutrients first so by the time they hit the mature wood in the lower portions in older taller trees, pickings can be skimpy to fuel the growth of another tree ring. It is this process that leads to the sought-after fine and tight grain found in older trees. Average estimates point to mature wood beginning to form when the tree reaches 20 years. Researchers at FPInnovations studying juvenile wood as MARKET REPORT (Continued from page 21) production. BC interior lumber production as of June 2019 is down 18.7 per cent year-to-date and doesn’t fully capture many of the mill closures and curtailments announced in the spring and summer. As such, it is looking to be the worst year for lumber production in the Interior since the trough of 2009. Similarly, the coastal sawmilling sector was down 9.7 per cent year-to-date for June. Coast lumber production will be dramatically lower than the May rate because it doesn’t reflect the strike at WFP that started on July 1 and has so far lasted the entire third quarter. Because of that, the Coast is set to experience one of the lowest levels of lumber production in decades.

48 Truck LoggerBC Fall 2019

part of the Douglas Fir Task Force study found that old-growth trees (250-500 years) had experienced a longer period to accumulated mature wood bringing the amount of juvenile wood to 10 or 20 per cent from the 50 per cent found in second-growth stands. Weather and site conditions can also influence growth ring size. In the Interior, the hot dry summers and cold winters result in wood that is slower growing and the spruce pine fir (SPF) lumber from stud mills producing machine rated strength lumber (used in house framing and cross-laminated timbers) while the Coast's larger diameter trees provide large or custom cuts, wood with less knots and the aesthetically pleasing fine lines in appearance grades of wood that architects search for. Keeping an eye on the ball OGMAs are not proven to be perfect; but they can be improved and co-exist with timber harvesting. The challenge that the Forest Practices Board's Doug Wahl, manager of audits and investigations, a registered biologist and author of the 2012 investigation report on OGMAs, sees (in the absence of an agreed upon definition of oldgrowth forests) is using sound science over emotion as the key to preserving old-growth traits in a region's biodiversity. Older trees, both alive and dead, provide specific values to plants and animals and their inclusion in OGMAs should reflect

those values. "What are the trees providing ecologically?" is the question that should be asked, he says. (In 2017, BC issued a procedural paper on how to assess old-growth stands for retention levels in OGMAs released by the Old Growth Forests Technical Working Group, a ministry team, with the protocol to be pilot tested in 26 areas. The project relied upon computer modelling). Wahl doesn't see modelling as the answer. He favours boots on the ground to gain a realistic idea of how OGMAs are preserving regional biodiversity. "We really need to look, in my mind, at how much old growth we need to preserve to gain an adequate representation of the eco-system," he says. Wahl says that BC also needs to record the OGMA attributes that are deemed important. Since OGMA emerged, information on unique attributes was either not recorded or as Wahl says the ministry has lost the information. "We need a central registry," he says, where the information can help track attributes over long periods of time, gauge their importance to an area and if they’re meeting diversity objectives. More monitoring would also track the impact of climate change, disturbances and recruitment stands able to stand in if the OGMA fails. Wahl says BC's biodiversity plan is geared toward having old-growth forests forever. "But, we can't have an area on a (harvesting) map that is a plan for the future without having a plan for the future," he says.

From the TLA’s perspective, the last major downturn took out a number of timber harvesting contractors and given those survivors have had little opportunity in the way of rebuilding their balance sheets, we expect further reductions in the number of contractors once this current downturn has past. Factoring in the strike on the Coast and impacts of curtailments and closures in the Interior, lumber production in the Province will be nearly as bad or worse than the low of 2009. Crossing over to log exports, their trend is similar to lumber exports and production, with a peak in 2016 and a steady decline since. For a number of years, log exports have represented ap-

proximately one third of the Coast total harvest. Based on what has happened thus far in 2019, total log exports are likely to be at their lowest since 2010. Unlike its positive trend for lumber, demand from China for BC logs has been decreasing. China is the largest purchaser of BC logs. These indicators mean less timber harvesting and of course less employment in


the woods. The Interior and Coast harvest will be smaller in 2019, likely similar to 2009-2010. Coastal log brokers have reported that the domestic log demand is very weak. New forest policies were implemented as of April 1 with higher utilization standards that bring three times stumpage for recoverable waste, and in July, higher fee-in-lieu charges for log exports were implemented on all new BCTS’ timber sales. The general view is that markets were (are) so poor that it is not possible to confirm fears of a negative harvest response to these new policy changes as of yet, although the growing number of BCTS' no-bid sales is concerning. The Interior harvest will continue to be dictated by reduced timber supply and lumber prices and stumpage, which are the result of a mountain pine beetle epidemic. All the data points in the direction that the Province’s forest sector is suffering the worst it has since the lows of 2009. Distinct differences exist between the downturn of 2009 and now, including that China has become an established major customer of BC forest products, the US softwood lumber duties have increased from 15 per cent in 2009 to 20 per cent in 2019, and significant cost inflation including stumpage has occurred for the BC industry. Also, the mountain pine beetle epidemic is over, which means we know the extent of the damage. Nonetheless, the industry is once again in crisis. From the TLA’s perspective, the last major downturn took out a number of timber harvesting contractors and given those survivors have had little opportunity in the way of rebuilding their balance sheets, we expect further reductions in the number of contractors once this current downturn has past. The most worrisome aspect thus far is even with all the reduction in harvesting and production across the Province, there has been very little sustained positive response in forest products prices. That’s not a good sign. David Elstone, RPF, Executive Director, TLA Tel: 604-684-4291 ext. 1 Email: david@tla.ca

Fall 2019 Truck LoggerBC 49


Photo courtesy of Taylor Loughran from Artbarn Films

50 Truck LoggerBC Fall 2019


TEAAM is a Solution to Emergency Medical Care

By John Betts

F

or years, the Truck Loggers Association, Interior Logging Association and Western Forestry Contractors’ Association have collectively advocated for increased support of helicopter emergency medical services (HEMS) that our employees deserve while working in remote or difficult access sites. In particular, the HEMS model provided by Technical Emergency Advanced Aero Medical (TEAAM). Since 2017, this group has been providing this much needed service for the forestry sector, as well as mining, oil & gas and tourism. As associations who represent employers’ groups we strive to make our industry’s workplaces safe and have all made improving workplace emergency response preparation and practice a strategic priority. We believe providing HEMS as part of the next step will help

our industry reach our goal of zero fatalities and reduce the traumatic impacts of serious injuries, which has led to our collaboration in promoting TEAAM to our members, along with agency and government decision makers. The majority of our crews work on remote or difficult to access locations throughout BC. Due to the extended time it takes to extract and transport patients from the site to emergency medical care, they risk worse consequences for their injuries. The well documented “Golden Hour” shows that faster emergency response times greatly increase the probability of an injured worker surviving a workplace injury and minimizing the impact of serious injuries. There are few situations in this Province where an injured forest worker could be in an emergency

ward within an hour under current response regimes. In most cases it would be well beyond that time. If HEMS were in place it could shorten response times saving lives and limbs—this is what TEAAM offers. The current model of injured patient transport from remote worksites involves several modes of transport and transfers between transporters and first aid attendants (helicopter, boat, pickup truck, search and rescue, fire/rescue, ambulance, etc.) often creating lengthy times before the patient actually receives the higher level of care, and potentially increasing negative outcomes. Additionally, 911 call centres are not experienced or equipped with the resources to effectively communicate and coordinate workers from a remote worksite to a hospital. This is unacceptable.

Fall 2019 Truck LoggerBC 51


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Even though TEAAM has only been in place for a short time, operating from one base with limited private funding, they have already made a significant difference in reducing the consequences to seriously injured workers in our sector. Since inception, they have treated and transported five insured workers including fallers, tree planters, etc. TEAAM provides sophisticated emergency medical care direct from remote site to hospital, providing the quick response that should be the minimum standard for our crews at remote worksites. TEAAM’s crew and equipment at an incident can shrink the precious time between a serious injury occurring and the patient receiving stabilizing treatment. It can then shorten transportation time by flying directly to the closest trauma centre. These potentially life and limb-saving features are critical given the remote and difficult settings where our sector works and injuries occur. It provides an extension of emergency treatment and rescue well beyond the capacity and timely reach of our public ambulance service. This is what sets them apart. We believe that

the advanced technical and medical service ability of the TEAAM model combined with our public healthcare system should be the standard of care for forestry workplaces in BC. We also believe that our organizations, WorkSafeBC and the BC Forest Safety Council have an opportunity to work collectively to improve worker safety outcomes in BC. WorkSafeBC has a vested interest and role to play in helping the forest and other resource sectors reach the goal of having a comprehensive HEMS service available provincewide. Reducing fatalities and decreasing traumatic impacts of serious injuries present both a moral and business case for WorkSafeBC. To advance this, we propose: • WorkSafeBC undertake a business case analysis for operating a HEMS model for remote workers in BC. This would compare available data, risks, costs and benefits involved in funding a provincial HEMS. We expect that work would include examining comparable schemes such as the Shock Trauma Air Rescue Services (STARS) in Alberta as well

as airborne emergency response operations in Europe and the US. • WorkSafeBC fund TEAAM’s current operations as an interim pilot to prove the HEMS concept for BC, gathering operational data on costs and making any recommendations to improve effectiveness. Time is of the essence to preserve TEAAM should its private patronage scheme fail to fully support its operations; without timely support it may not be able to operate over the long term. Acting with some urgency will prevent this possibility and its consequences. The TEAAM’s success so far is proof of concept already. It certainly is for those workers who have benefitted from their service. At the same time, more employers and their crews are seeing the benefits of HEMS as TEAAM becomes better known across the sector. This is contributing to justified rising expectations around improving the standard of emergency response for workers on remote and difficult sites across the Province.

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Stumpage: What You Need to Know

By Mike Greig, RPF, P.Eng

I

n 2018, the Province billed $1.2 billion in stumpage fees to forest companies in BC that harvested 62 million cubic metres; $267 million to coastal companies and $952 million to interior companies. That’s double the stumpage that was billed five years earlier, on less volume harvested. If you harvest Crown timber, you pay a stumpage fee based on your assessed stumpage rate ($/cubic metre) times the volume (cubic metres) of timber harvested. The assessed rate will affect decisions on whether to harvest (or not) and everyone who relies on harvesting for their livelihoods—including mills that consume those logs. Is this something you need to be aware of? Absolutely. What are the ins and outs? At one time, stumpage rates were easy to understand. Timber value minus the cost to harvest and deliver plus profit equaled the assessed stumpage rate. At other times, government simply set the target rate. However, since 2004, stumpage on the coast was calculated using the Market Price System (MPS). The change to MPS was in hopes of ending the perpetual litigation cycle associated with the softwood lumber battles between the US and Canada by implementing market-based pricing of harvested timber. The Interior stumpage system was changed to MPS in 2006. The main feature of MPS is the use of winning bids from BC Timber Sales’ (BCTS) auctioned timber to predict what someone might bid on a stand of timber and determine a stumpage rate. The MPS method, equations and allowances are published by the Province in the Coast Appraisal Manual and the Interior Appraisal Manual and each is updated annually. The latest Coast update was December 15, 2018 and the latest Interior update was July 1, 2019. How does MPS work? MPS relies on estimated winning bid (EWB) equations derived by the Timber Pricing Branch using statistical analysis of previous BCTS timber sale bids, value indicators (e.g. average log price, lumber prices, number of bidders) and

54 Truck LoggerBC Fall 2019

cost indicators (e.g. slope, cable vs helicopter). One set of equations is updated for the coast and another for the interior. The data sets are updated annually with the previous year of timber sales data; currently utilizing 12 years of data. Appraisal value parameters for log and lumber prices are compiled and published monthly using forest industry sales transactions. The final estimated winning bid (FEWB) is simply the EWB less any special cost considerations (called specified operations) that the BCTS timber sale holder is expected to incur but that would not normally have been considered in bids by market loggers in the timber sale data set, such as for tree crown modification. An upset stumpage rate is then calculated, typically as 70 per cent of the FEWB (known as MPS70) and the timber is then offered for sale via BCTS auction where bidders can offer a bonus bid in addition to the upset stumpage rate. The timber sale is awarded to the highest bidder and the stumpage rate is determined as the total of the upset stumpage rate plus any bonus bid from the winning bid of the timber sale. Sawlogs will be charged this amount. Timber sale stumpage rates are usually fixed for the term of the timber sale, and commonly range $40-$60/cubic metre with some higher than $100/cubic metre. Pulp grade logs (grades X, Y and hembal—Hemlock Balsam—U on the coast and grade code 4 and 6 in the interior) are charged stumpage at $0.25/m3 based on prescribed minimum stumpage rates set by the Province. There are planning and related costs required to prepare a timber sale, incurred and paid by BCTS. This includes forest planning and administration, primary road construction and silviculture, collectively known as tenure obligations, which can easily cost $20-$30/ cubic metre. For major tenure holders (e.g. with a forest licence, timber licence, tree farm licence), the process differs slightly. The Province calculates an EWB and FEWB similar to BCTS. Data is pre-

pared and supplied by industry, and on the coast the Province uses grade source history to help determine values for old-growth permits. Similar to BCTS, the major licensee prepares cutting permits. They also have tenure obligation costs they must incur for forest planning and administration, roads, silviculture, etc. To offset these costs similar to BCTS, the Province provides a tenure obligation adjustment (TOA) derived from a combination of BCTS costs and industry costs. The FEWB is then reduced by the TOA to arrive at an Indicated Rate for major tenure holders. Pulp grade logs are assessed at $0.25/cubic metre similar to BCTS. All major tenure holder cutting permits have their stumpage rates adjusted quarterly, on January 1, April 1, July 1 and October 1 using appraisal parameters that reflect market value conditions for that quarter. One point to note is the time lag. Log and lumber prices use three-month rolling averages derived by the Province (using industry log sales), delayed by two months for data collection. This means July 1, 2019 log price parameters are based on sales for the three months ending April 30, 2019. Lumber prices are three-month rolling averages using published prices. For the Coast, stumpage rates have been decreasing since summer 2019 reflecting the weaker log and lumber market conditions. In the Interior, the scarcity of timber supply (a legacy impact of the mountain pine beetle and wildfires) is having a strong influence on stumpage, driving up timber sale bids and stumpage rates. Interior stumpage has fluctuated based on the interplay of lumber prices and high bids over the last year, sometimes in the wrong direction with the current market; however, with the decrease lately in mill demand for logs and lumber prices, stumpage rates should be expected to decline.


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Profile for Truck Loggers Association

Truck LoggerBC magazine Fall 2019  

Truck LoggerBC magazine Fall 2019