British Columbia Log and Timber Supply Update

Last week Madison’s was ensconced in the comfort and splendour of Harrison, BC, to attend and present at the Forest Resources Association Western Regional Meeting. This event was attended by many forest operators in the Pacific Northwest, from both sides of the border. A lot of the focus was on the coast, but there were significant updates on the situation for BC interior forest operators, as well as those in Washington State, Oregon, Idaho, and Montana.
A very good presentation was made by the BC Ministry of Forests, updating the timber supply situation for British Columbia following the terrible wildfires of 2017.

Impacts of Recent British Columbia Wildfires: Update

SOURCE: British Columbia Ministry of Forests, Lands and Natural Resource Operations

One need take only a cursory glance at the horrifying map above to recognize the dire situation now facing BC interior forest operators.
Sawmills will often plan six quarters in advance for their log supply needs. So, conceivably, many of these facilities across BC would have planned at the beginning of 2017 to invest and order harvesting for their log yard right now. After those disastrous fires last year, many sawmills are only now finding out now what is the impact on their respective immediate timber supply.
As such, these manufacturers — who are experiencing phenomenal relentless demand from the US — must right now rework their log supply and timber harvest arrangements.
This of course, while they are at the same time continuing to work out maddening logistics problems caused entirely by Canada’s two railways.

SOURCE: British Columbia Ministry of Forests, Lands and Natural Resource Operations

This week at the Forestry Resources Association regional meeting for western North America, Albert Nussbaum of the BC Ministry of Forests gave some excellent updates on the current post-fire situation for the British Columbia timber inventory.

Never one to balk from the hard truth, Nussbaum started right out by saying the theme of his presentation was going to be “BC Timber Rationing”. So here we are.

In at least some welcome news, Nussbaum let us know that the outcome of the horrendous Mountain Pine Beetle infestation in BC was “not as bad as some had thought but still disastrous.”

“Using 2017 harvest levels, MPB killed the equivalent of 12 years of AAC (annual allowable cut), or 720 million cubic metres”.

As for the data, the scope of the 2017 wildfires were over 8 times that of historical average area of 142,000 hectares effecting a total of 1.2 million hectares.

SOURCE: British Columbia Ministry of Forests, Lands and Natural Resource Operations

An example of an operator impacted by this is the Norbord OSB plant in 100 Mile House, BC, which is “still struggling for fibre,” said Nussbaum.

The impact to overall timber supply was a loss of 25 million cubic metres in the mid-term supply and 12 million cubic metres of previously-available dead pine (post-mountain pine beetle disturbance).

In the greater view, the fires impacted 650 thousand hectares from the expected timber land base including a bunch of young plantations. Which will now have to be regenerated and planted all over again.

The BC Ministry of Forests has deployed areal surveys and used remote sensing data to map fire scenarios. The data has revealed an average ratio of loss of about 54% of the volume of stands within the fire perimeters.

Moving over to the Williams Lake timber supply area, the concept of “timber rationing” is going to come into play here as we move into the mid-term as well. Nussbaum described the current cut for Williams Lake as “actually right around where the supply is now” but harvest will need to decline considerably once savaging of dead timber becomes no longer viable.

So to the question of when does it get to the point of further mill must closers. Nussbaum detailed that this is a tough thing to predicted and is likely very sensitive to product price. Right now lumber prices are high, mills are operating and harvesting right up to their allowable volume and still struggling with removing and processing dead wood where possible .

To conclude, Nussbaum explained that the picture of timber supply in BC hasn’t changed dramatically from his department’s projection in 2007. That was and is a 20% reduction in timber supply from what was expected prior to the mountain pine beetle.