Today’s Need
Pulp and paper has held its place as a vital player in the BC economy for more than 100 years, and while markets, processes, and products have changed the industry’s future here remains bright.
We have a competitive advantage due to a unique combination of tree species, soil types and climate, which allow us to produce an exceptionally strong grade of pulp, known as NBSK. BC is a convenient location to access markets in Asia and North America. Billions of dollars in investments in mill upgrades which would improve competitiveness, enable new products for new markets, and enhance environmental protections and carbon reductions are on the drawing board — but they won’t make the next step into engineering and reality unless two big challenges are overcome by the industry working hand-in-hand with the provincial government.
The first is the need for a secure and economic fibre supply. About half of the fibre consumed by BC’s pulp and paper mills is the waste produced by BC’s world-class saw mill industry — sawdust, chips, shavings, bark are all by-products of the lumber products those saw mills produce so expertly and efficiently.
But with more and more of BC’s forests being ruled off-limits to the forest industry, those same saw mills are producing less lumber and slowing operations, which means of course less by-products to feed BC’s pulp and paper mills.
Alternative sources of fibre have been identified and are readily available in the form of timber damaged by BC’s extensive wildfires in recent years and in waste left behind after logging — tops, branches, stumps and the like which can be collected and fed to pulp and paper operations instead of being left in the bush as is often the case.
We must also address the high cost of production in BC. Many countries produce pulp and paper, from Sweden and Finland to Canada and the United States to China and Japan, and among all of them BC has the highest cost of production. Fibre here is expensive, and so is our very skilled workforce. But it is the regulatory and tax burden that really puts us at a big cost disadvantage to everyone else.
Just one example is the BC carbon tax, which is higher than what any of our global competitors face. While the tax was originally introduced to incent carbon emission reductions, Provincial programs only allow partial offset of the tax if BC companies reduce emissions and the North American market for carbon credit trading is not as well developed as Europe. Conversely, our main competitors located In Europe have up to a $100 per tonne or 20% cost advantage relative to BC mills as they not only can fully offset carbon taxes, but are able to sell their excess power and green attributes into the open market.
And all of this can be accomplished without cutting down one additional healthy tree: this is all about doing more with less.
