Western Forest Products CEO Don Demens will be speaking to a NAFTA panel to argue that American softwood lumber duties should not be applied to the cedar products the company makes. The North American Free Trade Agreement (NAFTA) does not cover softwood lumber, which was excluded from NAFTA and was not included in the recently renegotiated agreement. Source: BIV However, chapter 19 of the agreement allows companies to challenge US trade findings and restrictions they disagree with – even for goods and services not explicitly covered by NAFTA. The Canadian government will also be making a petition to a NAFTA panel in Washington. Its arguments will be broader. Mr Demens will zero in on appearance-grade lumber made from Western Red and yellow cedar. These products are not construction grade lumber, which is the heart of the softwood lumber dispute that has prompted the US government to levy duties of more than 20%. “Cedar products represented about 3% of the volume (exported to the) US. from Canada in 2018, but 9% of the total duties,” Mr Demens said. “So, we’re being impacted disproportionately by a dispute that really isn’t anything to do with cedar. “We’re going to continue to press the fact that cedar and redwoods are separate products from construction lumber, and therefore they should be investigated separately. They’re not the cause of the dispute because they’re not injuring any US producers. Why should we be penalized and have cedar in what is largely an issue around construction grade lumber? “Our argument is it’s a small volume, it doesn’t injure US producers and is not part of the cause of the dispute.” The market for red and yellow cedar is small compared with the construction grade spruce, fir and pine that is at the heart of the softwood lumber dispute. About 20% to 25% of the products Western Forest Products makes are cedar products, but 85% of the market for those products are in the US. The company operates six sawmills on the BC coast, and just recently acquired a mill in Vancouver, Washington. American softwood lumber duties have cost the company Can$71 million, as of the last quarter. Until last year, the duties were mitigated somewhat by record high lumber prices in the US. But prices have dropped, and at the same time BC producers are finding it harder and harder to even supply logs to their mills, thanks to a shrinking timber supply and high stumpage rates. Like other forestry companies, Western Forest Products has had to curtail production in recent months. The company has taken one shift off of its Cowichan Bay sawmill, took a six-week shutdown at its Port Alberni mill, and a two-week shutdown at its mill in Ladysmith. According to Western Forest Products, stumpage rates in BC have gone up 120% over the last two years. Mr Demens argues that there is no shortage of logs on the coast, unlike the interior of BC, where a physical shortage has resulted from forest fires and the Mountain pine beetle. “The challenges here on the coast are centred around costs and access to markets,” Mr Demens said. Part of the access to markets problem now stems from duties on Canadian softwood lumber.
Australian Paper and its partner SUEZ are moving to the development phase of their $600 million energy-from-waste plant after a two-year detailed study backed the project at AP’s Latrobe Valley paper mill. The $7.5 million Energy from Waste feasibility study, co-funded by the Victorian and Australian governments, confirmed that the plant would be socially, economically, environmentally and commercially viable. Source: Philip Hopkins for Timberbiz It would add a new dimension to the Latrobe Valley paper mill, the largest paper plant in Australia; stop waste being transported across Melbourne to landfill; save natural gas; lower carbon dioxide emissions; and create a massive economic boost, including hundreds of jobs in the Latrobe Valley and across the state. AP’s chief operating officer, Peter Williams, said AP and SUEZ were now focussed on taking this important regional investment in the Latrobe Valley to the development stage. “We will work to finalise approvals and seek to secure long-term waste supply contracts, as well as appoint suitable partners to undertake the engineering, procurement and construction phases,” he said. The summary report found the plant would help solve the pending landfill closures facing south-east Melbourne. “This could prevent about 550,000 tonnes of waste per annum being trucked across Melbourne from municipalities in the south-east to landfill sites located in the city’s west,” Mr Williams said. “The EfW project is the missing link in waste management infrastructure for the south-east, creating efficient energy from residual household and commercial waste, achieving a more sustainable outcome than disposal to landfills. The facility would reduce CO2 emissions by more than 540,000 tonnes per year.” With 80,000 tonnes expected also to be sourced from Gippsland, the total waste that would be processed at the Valley’s Maryvale mill is 650,000 tonnes. The report also found that by replacing natural gas at the Maryvale site, AP would return enough gas to the market to meet the annual needs of up to 70,000 Victorian households annually. “EfW technology is a proven and reliable low emissions technology, meeting the strictest European emission standards and has been used extensively in Europe, Japan and North America for decades,” Mr Williams said. In the construction phase, the report concluded that the proposed plant would contribute $483 million to Victoria’s gross state product (GSP) and about $228 million to Victorian household income. “This represents an average of 1046 full-time jobs per annum in the Victorian economy over three years,” the report said. The sectors most likely to benefit are construction, machinery and equipment manufacturing, professional, scientific and technical services, retail trade, chemical and non-metallic mineral product manufacturing, and finance and insurance services. The construction impacts in the Latrobe Valley are a $203 million boost to gross regional product (GRP), just under $89 million in household income over the three years of construction. This represents an average of 454 full-time jobs over three years. Once the plant is operational, the economic study estimates annual impacts of just under $199 million to Victoria’s GSP, about $76 million in household income and 911 full-time jobs when flow-on effects are taken into account. When operational, the plant would annually contribute $96 million to the Latrobe Valley’s GRP, $20 million in household income and 265 full-time jobs when flow-on effects are considered.
Six grassroots environmental activists will receive the prestigious Goldman Environmental Prize today. Dubbed the Green Nobel Prize, the Goldman Prize honors environmental activists from each of the six continental regions: Europe, Asia, North America, Central and South America, Africa, and islands and island nations. This year marks the 30th anniversary of the Prize founded in […]