B.C. to reduce raw-log exports in bid to boost higher value wood manufacturing

British Columbia intends to reduce the export of raw logs harvested in the province by requiring that certain types of lumber from the Interior undergo manufacturing first.

A statement from the Forests Ministry says changes to B.C. lumber regulations will require mills to "fully manufacture" lumber from cedar and cypress trees, producing items such as wood veneer, mouldings, shingles, siding, flooring and fencing.

Existing regulations allow "minimally processed" cedar and cypress to be exported from the Interior without further manufacturing.

The government says the amendment set to cut that practice will take effect in February, and that an exemption must then be obtained to export wood products that do not meet the specifications, such as logs, and a fee-in-lieu of manufacturing paid to the province.

The changes are part of a commitment made in 2019 by then NDP premier John Horgan to have companies process raw logs in B.C., with the goal of bucking a decades-long trend of local mill closures and increased log exports.

B.C. statistics show a significant rise in the value of all wood products exported over the past two years, which includes softwood lumber, cedar shakes and singles, and raw logs. In 2022, the value of those exports was more than $11 billion, up from $8 billion in 2020.

The Independent Wood Processors Association of B.C. welcomed the legislative changes announced Monday, saying in a statement that restricting raw lumber exports will create opportunities for higher-value manufacturing and keep more forestry jobs in the province.

In his mandate letter to Forests Minister Bruce Ralston, Premier David Eby said the "unchecked export of raw logs'' was among issues requiring change to ensure B.C.'s forest industry is sustainable.

The government statement released Monday says the change in the Interior builds on previous amendments that require western red cedar and cypress, also known as yellow cedar, to be fully manufactured before export from coastal areas.

"The regulation updates support work already underway to get more value from every tree harvested by strengthening the wood manufacturing industry," it says.

"In the coastal region, these export requirements have reduced the volume of minimally processed cedar leaving the province."

According to a provincial report, in 2020, there were 63 lumber mills in B.C. with an annual capacity to produce around 40 million board feet per year. Seventeen of the mills were on the coast, while 45 were in the province's Interior.

The past two years, however, have been marked by closures or curtailments for hundreds of workers across the Interior and on Vancouver Island.

Canfor, the largest producer of lumber in B.C.'s Interior, announced in September plans to build a new $200-million mill in Houston after shutting down facilities in that town, as well as in Prince George and Chetwynd.

The company said the new mill will have an annual production capacity of approximately 350 million board feet annually — about two-thirds of what the previous sawmill produced — and will be flexible enough to produce different wood products based on market demands. 

Canfor reported a operating loss of $49 million in its 2023 third-quarter report.