The forest industry in Canada is divided into three subsectors: solid wood product manufacturing, paper and pulp industry, and logging (Howlett & Rayner, 2014). The solid wood product manufacturing sector engages in both primary and secondary production for both domestic and export consumption. It is mainly done in Western Canada. The paper and pulp industry accounts for 36% of the forest sector contribution; it involves producing a range of outputs such as newsprint material, household tissues, and industrial manufacture of rayons. The final subsector is the logging and forestry section, which is responsible for harvesting timber and other field operations. It accounts for 20% in the forest sector contribution. However, in recent years, the forest industry has undergone a severe cyclic decline characterized by structural changes in the worldwide markets.
Challenges in the Canadian Forest Industry
Various problems are facing Canadian forestry. To start with, the regional difference between West Canada and East Canada poses a significant economic challenge to forestry in the region. These differences are mainly economic-based. Additionally, western Canada mainly comprises Americans, whereas the Eastern region consists of the Britons (Beese and Bryant, 1999). It causes disintegration and, therefore, working together to achieve a particular goal remains difficult. Furthermore, the western region is endowed with natural resources and it faces challenges such as lack of full support from the government. Secondly, they face the problem of outsourcing resources from the area. More so, they become restricted to sales within that region due to the differences in politics among other. The fact that most of the forestry operations in Canada are carried out in the rural areas poses a challenge; attracting employees, especially young people, is difficult because most people will not want to relocate to rural areas. Therefore, this results in most of the work force in forestry coming from the aged population who with time will be exiting the industry. In terms of speed and output, the elderly regarding are very low as compared to the young and vibrant. It, therefore, slows down operations, hence the low output.
Thirdly, the end product commodities mainly vary from softwood to pulp to newsprint. There is a challenge of weak demand on all of the above due to changing economic times, lifestyles, and technology (Beese & Bryant, 1999). For example, the demand for softwood was mainly from America in 2006. However, this changed drastically due to the alternative building and construction materials. Since time immemorial, the United States residential construction sector had been a key market for Canadian softwood producers (Manning, 2012). The slump down in the US housing sector has seen a drastic drop in demand for the wood-fabricated material. The Chinese have also increased competition by bringing in their plywood. As a result, many Canadian mills have been closed, and many people have lost their jobs. The demand most likely is not going to increase due to the importation. It remains an enormous challenge for the timber sales and the Canadian income. Furthermore, Canada is known to be the largest supplier of newsprint around the world. It supplies 42% of the world’s newsprint material (Nasi, Nasi, Philips, & Zyglidopoulos, 1997). However, with time, technology has offered an alternative means of delivering news and information online. It subsequently dropped the demand for the newsprint materials and, consequently, diminished newsprint sales. Canada grabs the largest share of the Northern bleached softwood Kraft pulp (NBSK). However,…