e Lumber exports to Europe have plummeted since the discovery of a shipment contaminated with the insect

larvae.

European ban threatens lumber jobs

by Phillip Leg;
Assistant papeonch Director

IWA-CANADA

The on-going issue of green lum-
ber shipments to Europe took a
turn for the worst with the discov-
ery of an infested shipment of lum-
ber in late-June. The lumber, which
was produced by a Maritime
sawmill, had violated European
environmental regulations, which

are designed to control imported
commodities that can carry insects
harmful to European forests.

With forest industry unemploy-
ment close to 30%, the last thing
woodworkers need is to lose an
important market like Europe.
According to industry estimates, the
ban could hit a major portion of
Canada’s lumber shipments to
Europe and put at risk close to $700

million worth of lumber shipments
from B.C. alone.

At issue in the European Commu-
nity (E.C.) regulation of green lum-
ber is their concern about the
pinewood nematode. This micro-
scopic bug is indigenous to North
American forests and the E.C. is
concerned that without specific
restrictions, green lumber from
Canada could be contaminated with

nematode larva which, once shipped
to Europe, would devastate forests
in that region.

The contamination could occur if
the manufacturing process does not
eliminate the bark and bore holes
from a piece of green lumber. It is
this wainy portion of a green board
that carries the nematode larva.

The most effective way to deal
with the European regulations is to
kiln dry all lumber shipments.
However, Canadian producers
argue that kiln drying is not a
viable answer for all their lumber
shipments.

As an interim measure, the Euro-
peans had provided some exemp-
tions for green lumber shipments
from Canada. But the discovery of |
the infested shipment in June has
all but eliminated those exemp-
tions.

Starting in July, the European
authorities have specified that all
lumber products from Canada have
to be either kiln dried or heat treat-
ed (core of wood must be heated to
56°C). The only exception to this
provision is western red cedar,
which the Europeans recognize as
not subject to pinewood nematode
infestations.

The impact of the European ban
on green lumber has been very sig-
nificant. B.C. mills, for example,
which traditionally have supplied a
large portion of the European mar-
ket, have seen their shipment vol-
umes drop from an average of 1.1
billion board feet prior to the ban to
less than 500 million board feet cur-
rently.

Regaining lost markets in Europe
will be an uphill battle. In the short
term, Scandinavian producers have
moved quickly to fill the void left by
Canadian mills. Adding to their
close proximity to the European
market, the Scandinavian mills also
benefit from a recent devaluation of
their currencies relative to the
European currencies. The 25 to 30%
devaluation has provided a very
immediate boost for Swedish and
Finish lumber producers.

Over the longer term, however,
Canadian mills can regain the loss-
es that they are currently seeing in
Europe. But to achieve that will
require a substantial commitment
to kiln drying. The IWA has long
argued that it makes more sense to
dry and ship lumber to Europe than
live with the uncertainties of
exemption from established Euro-
pean regulations.

Value-added report draws
mixed reviews from IWA

In early June, a Committee of the
British Columbia Legislature
reported the results of a six-month
study and public hearing process on
the issue of value-added wood prod-
ucts manufacturing in B.C. Because
of the employment implications that
surround any shift towards value-
added, the Committee’s report has
generated considerable debate with-
in the B.C, forest sector.

How the goals of the report, espe-
cially those related to employment,
are achieved and what that will
mean in terms of policy change in
B.C. are still unresolved questions.
From an IWA perspective, unless
the programs esta’ lished by the
previous Socred government are
completely overhauled, any of the
recommended amendments outlined
in the Committee’s report would not
help achieve the stated goals.

major Socred on val-
ue-added, the Business For-

i Enterprise Program (SBFEP)
fee a iacaied ithe late 1980's.

Rather than direct established oper-
ators into higher value manufactur-
ing activity, the SBFEP encouraged
new pom panies to start up opera-
tions in the industry.

On the manufacturing side, many
of these “new” operations were non-
union, low-wage facilities. Even
more troubling for the IWA was the
possibility that the work done in
these “new” operations could trans-
late into less work in established,
unionized mills.

A similar pattern existed on the
logging side of the industry because
most of the harvest available under
the SBFEP was the result of reduc-
tions in the cutting rights of estab-
lished licenses. In many instances,
the impact of SBFEP meant that
unionized company crews were
being replaced by non-union, con-
tractor crews.

Unfortunately, the Committee’s
report does very little to significant-

Continued on page two

° The IWA says value added policies should be geared for high skills and
high wages.

LUMBERWORKER/NOVEMBER, 1993/3