Pine Beetle Pain Begins

Pine Beetle Pain Begins

mountain-pine-beetle

…but it’s not too late to act now and shorten the suffering.

For almost two decades we have watched a slow-motion forestry crisis unfold in British Columbia. The mountain pine beetle epidemic has wiped out mature pine trees over an area larger than Florida. It has spurred a virtual mountain of studies and speculation on the future for forestry-dependent communities in the Province (of which I acknowledge, that I have certainly added my fair share). Indeed, the volume of paper dedicated to this subject has probably kept one or two milling and pulping operations going over the past few years.

Yesterday, forest product giants Canfor and West Fraser Timber announced that there is insufficient timber volume remaining after the conclusion of salvage logging to support their milling operations in Quesnel and Houston, respectively. This was met by some with shock that it is occuring so soon. But it shouldn’t have been a surprise. This has been an inevitability from the start of the beetle explosion. And the large industry players will not sit by and watch their economic fortunes dwindle before they act. They are, and will continue, to act pre-emptively to keep their operations efficient and profitable. These large corporations exist by producing the largest volume of forest products at the lowest cost for export markets. This will increasingly come in the form of consolidating manufacturing centres and through reducing jobs.

In many respects the job losses announced yesterday will be the first bit of real social and economic pain inflicted by the pine beetle on B.C. For many interior communities, the pine beetle epidemic has been a major economic driver for the past decade. The huge stock of dead trees left in the wake of the beetle needed to be harvested and processed while the timber still had value to the forest products sector. And this has keep the mills humming, the logging trucks rolling and the saws sawing. It is now at the point where the amount of merchantable timber in the areas first affected by the beetle is too low to justify logging. That lost volume means there isn’t enough to keep the lumber mills working at sufficient capacity for the corporations to justify their continued existince. And when the mills close there are direct job losses and many indirect job losses that are tied to forestry.

The next shoe to drop will come from the secondary manufacturers. The forest products sector is highly integrated. Waste from the sawmills (e.g. wood chips and sawdust) support a host of other enterprises. When less trees are cut for lumber, there is less wood chips for pulp mills and oriented-strand board manufacturers. Less sawdust means MDF and wood pellet operations have less feedstock. Once again, when the volumes drop below an economic threshold (which is never zero) the millls will close before they run at a loss.

And for many small towns in BC’s interior this will mean even less employment opportunties and more pain.

Timber tenure consolidation was also part of the announcement yesterday. West Fraser and Canfor will be swapping timber cutting rights to concentrate the remaining timber supply. Much as I speculated back in 2009 (Timber Sellers Should Brace For Another Round of Consolidation) more of this is likely to come. It will lead to more mill closures and will also impact small-scale timber sellers (e.g. woodlot owners), once they are locked into to monopolistic regional timber buying zones.

Things are bad. Things are likely to get worse. But all is not lost. The level of response to this crisis has certainly not kept pace to the level of finger-pointing and ‘buck-passing’, and Governments at all levels have not acted enough to prevent or minimize this first round of pine beetle pain. But that doesn’t mean we collectively can’t start with some earnest diversification efforts. The studies have been done, the talk has been talked. The forests are a wealth of non-timber forest resources that could be developed – everything from natural health products to bioenergy. We just need some political will and supportive policies to make it happen.

Silvopastures as Ranch Insurance

CMRussell

There can be many motivations for adopting agroforestry practices. While not a cure-all for land management, agroforestry presents a range of viable production options that can provide social, economic and environmental benefits through integrated use.

I think it can be constructive sometimes to view a silvopasture (integrated tree, forage and livestock production areas) as a form of insurance in the ranching sector. A living insurance policy through diversification that works on many levels.

First, it can be a form of production insurance as a means to diversify grazing resources on the ranch. Trees can help conserve moisture in their understory, and they delay the maturity of forbs and grasses. This means seasonal drought or high temperatures that can dessicate open grown-plants, are tempered in the silvopasture. These types of droughts can occur annually in some areas or are less frequent but still expected in other areas. But in both cases, having a portion of the ranch’s forage production derived from silvopastures insures against total forage losses. And silvopastures can maintain a source of higher quality green feed, when other grasses and forages have weathered away. Moreover, in northern areas, the main benefit may come from increased frost protection in the spring and fall. The ability of the overstory canopy to erase small radiative frosts adds valuable frost-free days to the growing season, thus extending the availabilty of higher quality grazing resources.

Second, it comes in the form of insurance for the whole operation against a significant downturn in beef cattle prices. Cattle markets are cyclical. Always have been, always likely will be (and I don’t see supply management systems taking root in the beef sector). Therefore, even the best and most efficient ranch operations in the world still need to plan for significant market down cycles where their profit margins will be dictated by conditions outside of their control. The BSE crisis in Canada has also taught us that export markets can collapse rapidly and for prolonged periods, with little fore warning in the modern globalized, food supply chains. Making sustainable use of another renewable resource on the ranch provides insurance against losses in your beef business bankrupting the operation. Silvopasture, and the opportunity to sell timber or other forest and non-timber forest products during a low in cattle prices, may be the difference for some ranches between staying in the business for the long-run and falling victim to short-term market pressures.

Third, silvopastures, through the host of ecological goods and services (EG&S) they provide, contribute to building and sustaining social insurance for individual ranches and the sector as a whole. Understandable, some producers may not relish the situation, but all must acknowledge the facts: if you live in a rural area, you are now in the minority. And if you farm or ranch, you are in the minority. The political power resides largely in urban centres, and without a constant and deliberate effort to build goodwill in communities, regions and nations, ranchers are more vulnerable to misguided policies and that will wrap them too tight in red tape to move, let alone carry out their businesses sustainably and profitably. Silvopasture and all agroforestry, through providing EG&S, aesthetics and other non-tangible benefits, contribute to sustaining the social license that the beef sector needs to keep operating in world increasingly dominated by urban dwellers divorced from the realities of agriculture.

Canada’s Food Safety Paradox

Total Recall is not just the title of this past summer’s sci-fi blockbuster remake. It also aptly describes the ever expanding scramble to remove beef products processed by XL Foods from the pantries of the nation because of possible E coli contamination. This costly disruption to the food supply also highlights how quickly and extensively a lapse in standards at just one location can impact tens of thousands of consumers across the country. This incident is far from isolated; it was only a few short years ago that listeria outbreak originating in processed meats killed and caused illness in many. It exposes a fundamental weakness in having a highly centralized and concentrated food processing sector. And it also suggests that past decade of increased food processing standards, paradoxically, may be increasing the risk of spreading of food borne illness and contamination.

Meat processing capacity used to be distributed among many regional entities from small local abbatoirs through medium and larger enterprises. In the name of protecting the health and welfare of Canadian consumers (and who would argue publically that we shouldn’t raise the bar as high as possible on food safety?), and Canada’s international reputation as a source of safe and high quality food, Federal and Provincial governments have implemented a series of regulatory changes that have dramatically raised the per unit costs of slaughtering and processing.

But these changes may have only created the perception of increased safety and quality. In fact, quite the opposite may be happening. The higher costs associated with implementing all the required standards has pushed many of the small facilities out of business (taking with them many farmers and ranchers who can no longer get their meat used for farm-gate sales processed in a licenced facility), because they simply didn’t have the resources to implement the necessary changes nor the slaughter volume in order to make a fair return on their infrastructure investments. For the medium and larger packers it has accelerated the pace at which the industry has concentrated. As costs go up, the larger, high volume operations are better be able to create economies of scale.

The result being that meat processing is now more highly concentrated than ever before, with a few large operations serving most of the Canadian retail and institutional buyers. But with this high concentration comes big vulnerabilities. If there is a lapse in operating standards (as is apparantly the case at XL), one or two infected animals can cross contaminate the meat from thousands of other carcasses. If you have problem in a small facility, the potential impacts on an individual are just as severe, but the scale of those affected are limited to a local or regional distribution. But when you have a problem at an XL-sized facility the potential impacts are distributed from coast to coast to coast, and beyond to the export markets.

Industry has responded to the high-cost food safety regulatory framework in Canada by investing in bigger, centralized operations. But bigger is not always better when it comes to food safety. Support your local food processors before they too fall victim to economies of scale.

Timber Supply Review Provides Sliver of Hope for Integrated Options

British Columbia’s all-party legislative Special Committee on Timber Supply released it’s report today (“Growing Fibre, Growing Value“) outlining options to address the decline in timber supply in the wake of the mountain pine beetle epidemic. And while logging in protected areas and other reserves had been considered as an option to maintain the current timber harvest volumes, the Committee appears to have clearly heard the message of many community stakeholders, and is recommending that the local land use planning processes that created those reserves be respected.

It is disappointing that agroforestry was not explicitly considered, but a prevailing theme throughout the report is of greater consideration for non-timber values in the timber supply decision process. And by more fully incorporating non-timber values into forest management, together with proposed tenure reforms expanding the type and form of area-based opportunities (currently 80 percent of public forest tenures are volume-based licensing), there is now some hope that forestry in BC can more fully embrace integrated production options. As I’ve repeatedly opined on this site, agroforestry and non-timber forest resources should be part of the transition in the resource economy over the coming decades. But a wall of structural barriers is holding these opportunities back on public lands.

Since 1999, an estimated 18.1 million hectares of land in BC have been directly affected by mountain pine beetle with the latest projections indicating that between 53 and 70 percent of merchantable pine will be killed by 2021. According to the report, when beetle-killed pine is no longer salvageable, the province’s supply of mature timber will be reduced 20 percent below the pre-infestation levels. And this reduction may last up to 50 years. These changes are having a transformative impact on the socio-economic structure of the region. Planning and diversification efforts to-date however, have not greatly shifted the trajectory of resource-dependent communities to a more stable and sustainable foundation. The status quo will inevitably lead to a mass migration from the area, leaving social services vulnerable to the shrinking tax base and aging demographic. The need for change is now almost universally accepted, but there is nothing close to a blue-print for that change.

But all hope is not lost. The timber supply review report could be a catalyst to move meaningfully towards integrated production options on public lands, such as agroforestry systems. Tenure reforms that are more inclusive of integrating timber and non-timber values would also be a great help in this regard. If this is coupled with targeted support programs to address training, infrastructure and marketing gaps, it could stimulate a parallel, compatible, sustainable resource industry to fill the economic gap from reduced timber harvesting and processing that is coming. Providing the rights to timber and non-timber resources in a single tenure package is also one of the avenues to encourage greater private-sector investment in silviculture (e.g. pruning, spacing and fertilization) beyond the minimum obligations currently employed, because of the potential economic gains from blending short and long-term economic returns. And synergies in blending timber and non-timber production can be created resulting in a true ‘win-win’ scenario. But this will only happen if there is the will to make the change. To date, the forest sector seems more willing to lament it’s fortunes than to embrace a fundamental shift in what constitutes ‘forestry’ in BC.

Although the whirl-wind of activity around organizing and compiling input from the community consultations and other submissions may have seemed like an onerous task given the very tight timelines, the ‘heavy-lifting’ has yet to be done. Talk is far too cheap. And every year of inaction merely sets back the transition process. For now at least though, there is hope in this review and that is something to embrace.

Shifting BC Forestry From Resources to Resourcefulness

British Columbia finally appears ready to address the consequences of the mountain pine beetle (MPB) epidemic. Earlier this month the provincial government formed a Special Committee on Timber Supply to tackle the impending mid-term timber supply deficit in the interior of BC that has come about as a result of the MPB infestation.

This initiative comes after a report leaked to the public merely stated the obvious and what has been known for over a decade: the beetle-killed trees will not last forever. In as few as 18 months from now the forest industry will need to start scaling back production, with thousands of jobs lost and millions of dollars of decreased economic activity, as the timber supply declines. These depressed timber supply levels could last for another 60 years as the pine forests regenerate and mature.

Hopefully the Special Committee is not the latest in a long line of stall tactics, whereby politicians and bureaucrats continue to play a game of ‘kick the can down the road’. To date they seem to be hoping that some golden future will magically arrive and wipe away the lack of diversification that currently hobbles the region. For despite millions of tax dollars spent on planning and research, there has not been any substantive moves to address economic diversification on a scale that will mitigate the potential contraction in the forest industry. And, as so aptly summed up in the algorithmic poetry of Vancouver punk band legends D.O.A., “talk minus action equals nothing.”

The government’s openness to listen to the ideas of affected communities, and to consider the conversion of volume-based tenures to area-based tenures (giving land managers a stronger incentive to enhance production, rather than ‘cut and run’), are positive moves. However, the Committee has also opened the door to wide-scale logging in areas currently managed for their biodiversity, wildlife and scenic values through retooling land use objectives that limit tree removal in areas so zoned. These are areas however, that were set aside after a long and sometimes difficult land-use planning process in the 1990s that recognized that public forests have significantly more value than simply as a timber reserve. Increased timber harvesting in these areas will take away some of the short-term public pressure on the government to maintain forestry jobs, but in the end it will only push our timber supply problem on the next generation. The highly efficient timber harvest and processing capacity in BC can deplete these set-aside areas long before the pine-beetle ravaged zones have regenerated.

Ultimately, carving into forest reserves is an admission of our inability to tackle the economic renewal of the region and would be both irresponsible and short-sighted. The solution to the MPB crisis requires a philosophical shift to begin the transition from primarily relying on resources to relying on resourcefulness.

So Special Committee on Timber Supply, please blow the dust off the Beetle Action Coalition diversification plans and dive into the potentially messy process of tenure reform and exploring new forms of forest tenure. There is a shortage of timber for business as usual, but not if we embrace a more innovative approach that sees the forest as more than just trees.

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