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U.S. Trade War Impacts Likely to Challenge Forestry Industry in 2019

Author:Zhengyang MachineryTimes:2022-10-19 15:25:11
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In an update to the members of the Timmins City Council, EACOM- the major Eastern Canadian wood products company expressed fears that the impacts of the US trade war may likely impact the forestry industry in 2019.
Christine Leduc, EACOM’s director of public affairs stated that the company has made investments of around $85 million in its manufacturing facilities across Ontario and Quebec since 2012. Out of this $35 million was invested in Timmins mill, which was destroyed by a fire incident. The investment towards technological and equipment upgrades has boosted the mill capacity by additional 20%.
The company has been paying 20.23% duty on shipments to the U.S. The amount paid in duties is quite significant as nearly 60% of EACOM’s production is shipped to the U.S.
The series of wildfires in the B.C region coupled with hurricanes in the U.S. led to sharp rise in demand, which in turn took prices to new highs. However, the prices have witnessed drastic decline since May 2018. EACOM expressed concerns that forestry companies may find it extremely difficult to absorb the high duty, without sharp recovery in prices. Meantime, Leduc extended support to the proposed forestry strategy by the provincial government to boost forestry sector economic growth.
EACOM highlighted several challenges including labour, access to trees, access to markets and transportation.
The company reiterated its demand for $75 million forest access roads funding program in the 2019 provincial budget.

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