As we work to make CLT a material of choice, we also need to consider the human side of the equation. How will increased demand for wood impact economies, mills and the people who work in them?
DOLLARS AND SENSE
Forest utilization is integral to North American economies, but who really benefits?
For some, it starts with the land. More than half of America’s forests are owned by private landowners, including more than 10 million family forest owners.1 Strong markets for wood products provide a financial incentive for landowners to invest in their forests and keep them healthy for future generations.
But could we sustain increased harvest? North American lumber production in 2015 was 57 billion board feet (BBF). This compares to nearly 75 BBF a decade earlier when housing starts were at their peak, at more than 2 million single-family homes. Last year, U.S. housing starts were at just 1.11 million units.2 In other words, North America produced almost twice as much lumber a decade ago, yet our net forest growth over the past 50 years still exceeds annual forest removals.3
Demand also impacts the import/export of manufactured wood products. Joe Elling, Director of Market Research for APA – The Engineered Wood Association, said, “Combined exports from North America to the rest of the world were 6 BBF while imports from the rest of the world were 1 BBF, meaning North America was a net exporter of 5 BBF.” Canada ranks as the world’s second largest exporter of forest products and the sector is the second biggest contributor to Canada’s trade surplus. Forest products are now Canada’s largest export to Asia; exports to China have soared by nearly 400 percent over the last decade.4
MILL CAPACITY BANDWIDTH
If demand increases, do North American wood products mills have bandwidth in terms of being able to handle more production?
“Yes, we definitely have the potential to take advantage of higher sustainable harvest levels in Canada,” said John Pineau, Provincial Leader/Ontario for FPInnovations. “We lost a number of mills in the last downturn, so there’s opportunity to reopen some, but also to use available wood fibre for a variety of new and innovative products.”
Mills in most of the western U.S. states are operating well below their capacity, said Todd Morgan, director of Forest Industry Research at the University of Montana. ”If CLT demand increases, we could get mills closer to full operation. In Idaho, for example, some of the larger lumber producers are only running at 55 to 60 percent, and mills in Oregon and Washington are at just 70 or 75 percent. So we have unutilized capacity to process timber.”
Over the past two decades, California’s forest products industry’s capacity to process timber dropped by more than 70 percent. Of this remaining capacity, only 72 percent was utilized in 2012.5 And in the southern U.S., softwood sawmills were operating at less than 75 percent capacity.6
IMPACT ON PEOPLE
Almost 290,000 Canadians work directly or indirectly in the forest sector, and the construction industry employs another million.7 In 2014, average wages were more than $1,000 per week, 19 percent above the national average.8 70 percent of Aboriginal communities are located in forested regions of Canada, and the forest industry is one of their largest employers, with nearly 10,000 Indigenous workers.9
In the U.S., the forest products industry employs nearly 900,000 people, exceeding employment levels in the automotive, chemicals, and plastics industries. Wood manufacturing accounts for more than a third of those jobs.10
But jobs are tied to demand. According to the Bureau of Labor Statistics11, employment in the U.S. wood products industry declined by 47 percent between 1999 and 2011. “Here in the Pacific Northwest, we think that the move to increase demand for CLT and other wood products has great potential to revive rural communities,” said Timm Locke, Director of Forest Products with the Oregon Forest Resources Institute. “We have an active effort in Oregon to support advanced wood products manufacturing. It’s an opportunity to revitalize rural areas that have been hard-hit.”
ROOM FOR GROWTH
Our industry appears to have ample room for growth. While some fear the impact that increased demand for wood will have on our forest resource, the societal benefits also warrant consideration.
The environmental and carbon impacts of the building materials we choose are hot topics. We’ll take a closer look at these global issues.
1. American Forest & Paper Association, Forest Facts, 2016
2. National Association of Home Builders, January 2016
3. American Wood Council, Wood and Green Building
4. Forest Products Association of Canada, 2014
5. USDA, California’s Forest Products Industry and Timber Harvest, 2012
6. Recession Effects on the Forests and Forest Products Industries of the South, D.G. Hodges et al
7. State of Canada’s Forests, 2015
8. Statistics Canada, 2014
9. State of Canada’s Forests, 2015
10. American Wood Council
11. Bureau of Labor Statistics