Canada

Demand for Saskatchewan forest products surges in 2020

Global market demand for home construction and renovation materials has led to a surge in demand for Saskatchewan forest products.

The Saskatchewan government said forestry sector sales rose 30 per cent in 2020 to $1.1 billion.

Officials said COVID-19 initially created market uncertainty in the forestry sector, but that changed last summer with an increase in demand.

Read more: Lumber industry and home building materials seeing a drastic increase in price, shortages

They said prices for lumber, oriented strand board (OSB) and treated wood products, which are used in decks and fences, are currently at record highs.

“Our forestry sector is a key economic driver and will be a leader of Saskatchewan’s post-pandemic recovery efforts,” Energy and Resources Minister Bronwyn Eyre said in a release Wednesday.

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“Forestry is an important sector for many communities in Saskatchewan and supports thousands of jobs, while producing important products that we all use, including tissue paper, cabinetry and housing construction materials.”

The forestry industry is currently northern Saskatchewan’s largest sector, supporting nearly 8,000 jobs with seven major primary forest products facilities producing lumber, OSB and pulp.

One of those companies is NorSask Forest Products, a 100 per cent Indigenous-owned forest products mill in Meadow Lake.

The owner, Meadow Lake Tribal Council, says production capacity at its mill is currently in excess of 140 million board feet of lumber annually.

“Profits from our NorSask Forest Products operation drives capital investment to increase the mill’s production capacity, as well as supporting economic development, providing jobs and social programs, as well as infrastructure for the nine First Nations communities represented in the Tribal Council,” said Al Balisky, president and CEO of Meadow Lake Tribal Council Industrial Investments.

Read more: Benchmark lumber prices jump to a record despite slowdown in sales

The province said the future bodes well for the industry, with the production of timber and forest products in Saskatchewan expected to reach record levels in 2022.

Officials said the development of the sector has the potential to generate more than $2 billion in forest product sales annually and support nearly 12,000 jobs.

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More than 75 per cent of Saskatchewan’s primary forest products are exported to other countries, which was valued at $700 million in 2020, according to the government.

A growing Asian economy and the ongoing housing recovery in the U.S., which is seeing the highest number of housing starts in 15 years, have been keys to those export numbers.

“Saskatchewan is well-positioned to benefit from a number of emerging opportunities in the future, with further expansion of existing mills, new mills and increased employment and exports in this sector thanks to favourable market conditions,” said Nadine Wilson, the legislative secretary to forestry.

Lumber industry seeing drastic price increase and shortages – Apr 10, 2021

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