Automatic reply: RE New Brunswick to cut timber royalties charged to forestry companies up to $50M
Moore, Rob - M.P.<Rob.Moore@parl.gc.ca> | Mon, May 1, 2023 at 1:01 PM |
| To: David Amos <david.raymond.amos333@gmail.com> | |
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RE New Brunswick to cut timber royalties charged to forestry companies up to $50M
David Amos<david.raymond.amos333@gmail.com> | Mon, May 1, 2023 at 2:23 PM |
| To: yscfredericton@yscnb.ca, senbmb@nbnet.nb.ca, nwoodlot@nb.aibn.com, nsfpmb@nbnet.nb.ca, odvdm@nbnet.nb.ca | |
| Cc: motomaniac333 <motomaniac333@gmail.com> | |
Forest Products Marketing Boards
Carleton-Victoria Forest Products Marketing Board Telephone: (506) 392-5584 Chairman: Andrew Clark Madawaska Forest Products Marketing Board Telephone: (506) 739-9585 Chairman: Charles Albert
North Shore Forest Products Marketing Board Telephone: (506) 548-8958 Chairman: Mario Comeau
Northumberland County Forest Products Marketing Board Telephone: (506) 622-7733 Chairman: Norman Richardson South East New Brunswick Forest Products Marketing Board Telephone: (506) 532-1150 Chairman: Gerard Dupuis Southern New Brunswick Forest Products Marketing Board Telephone: (506) 433-9866 Chairman: John Sabine York-Sunbury-Charlotte Forest Products Marketing Board Telephone: (506) 444-6644 Chairman: Dale Mowry ---------- Forwarded message ---------- From: Linda Bell <Linda.Bell@cvwpa.ca> Date: Mon, 1 May 2023 16:15:25 +0000 Subject: RE: RE New Brunswick to cut timber royalties charged to forestry companies up to $50M To: David Amos <david.raymond.amos333@gmail. Sorry you could not hear me – my cell phone does not work in the office and our phone lines are out of service here now. We have had no power and just got it back but still no phone service. Thanks for sending me the email – I will read through it. | |
David Amos<david.raymond.amos333@gmail.com> | Mon, May 1, 2023 at 1:01 PM |
| To: chris.spencer@snbfpmb.ca, pfolkins@snbwc.ca, kim.jensen.cvfpmb@outlook.com, linda.bell@cvwpa.ca, Davidc.Coon@gmail.com, "blaine.higgs" <blaine.higgs@gnb.ca>, "Holland, Mike (LEG)" <mike.holland@gnb.ca>, snb@nb.aibn.com, devans@coxandpalmer.com, markandcaroline <markandcaroline@gmail.com>, Newsroom <Newsroom@globeandmail.com>, news <news@kingscorecord.com>, nbfwo@nb.aibn.com, news <news@dailygleaner.com>, leader <leader@greenparty.ca>, leader <leader@greenparty.pe.ca>, office@peoplesalliance.ca, "michelle.conroy" <michelle.conroy@gnb.ca>, chris.o'connell@gnb.ca, eolsen@quispamsis.ca, grantbrenan@hotmail.ca, info@nbndp.ca, syp.okana@gmail.com, gilles.lepage@gnb.ca, "guy.arseneault" <guy.arseneault@gnb.ca>, benoit.bourque@gnb.ca, rene.legacy@gnb.ca, "keith.chiasson" <keith.chiasson@gnb.ca>, Chuck.Chiasson@gnb.ca, Jean-Claude.D'Amours@gnb.ca, "francine.landry" <francine.landry@gnb.ca>, isabelle.theriault@gnb.ca, eric.mallet@gnb.ca, david.coon@gnb.ca, "Arseneau, Kevin (LEG)" <kevin.a.arseneau@gnb.ca>, "Mitton, Megan (LEG)" <megan.mitton@gnb.ca>, amanda.wildeman@greenpartynb.ca, Josh.O'Donnell@gnb.ca, oldmaison@yahoo.com, andre <andre@jafaust.com>, "kris.austin" <kris.austin@gnb.ca>, Mike.Comeau@gnb.ca, "Michael.Duheme" <Michael.Duheme@rcmp-grc.gc.ca>, "Dominic.Cardy" <Dominic.Cardy@gnb.ca>, "Jacques.Poitras" <Jacques.Poitras@cbc.ca>, "robert.mckee" <robert.mckee@gnb.ca>, "robert.gauvin" <robert.gauvin@gnb.ca>, "jacques.j.leblanc" <jacques.j.leblanc@gnb.ca> | |
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Monday, 1 May 2023 New Brunswick to cut timber royalties charged to forestry companies up to $50M | |
New Brunswick to cut timber royalties charged to forestry companies up to $50M
Fees to cut lumber-quality softwood dropping 46%
It's a move Linda Bell wasn't expecting and doesn't like.
"I really couldn't believe that it dropped that much," she said.
Bell, general manager of the Carleton Victoria Wood Producers Association in Florenceville, says lower royalty rates reduce revenues to the province, but they also make it difficult for private sellers of wood to get decent prices for what they cut.
Linda
Bell represents independent woodlot owners in western New Brunswick and
says the province reducing the royalties it charges for wood cut on
public land undercuts smaller private sellers. (Submitted by Linda Bell)
"The more cheap wood that the mills have from Crown, the less incentive they have to buy our wood," said Bell.
In a posting on the province's Public Review of Draft Regulations website last week, the Department of Natural Resources and Energy Development listed several proposed changes to timber royalties that are charged to New Brunswick forestry companies.
The most significant is a 46 per cent reduction in charges for softwood sawlogs and studwood used by New Brunswick sawmills to manufacture both high and low grades of lumber.
Based on current royalties and historical volumes cut on public land, the price drop will likely cost the province and save forest companies $50 million in fees this year.
The department is asking for public comment on the changes but did not respond to a series of questions about them last week.
New Brunswick raised the royalty rates on publicly owned timber for the first time in seven years last September in a belated, but heavily promoted effort to profit from two years of record lumber prices.
New
Brunswick forestry companies saw their revenues from wood manufacturing
increase by more than $1 billion when lumber prices surged. New
Brunswick raised its timber royalties only as prices fell and is now
retracting most of the increases. (CBC)
"We've instigated an increase for this year, a fairly significant increase," Natural Resources Minister Mike Holland told CBC News last summer in one of a number of interviews announcing the higher fees.
In 2021, New Brunswick wood manufacturers, mostly sawmills, reported a record $2.6 billion in sales, $1.2 billion more than two years earlier on similar amounts of production.
That helped convince the province it should charge more for trees the mills were using, but the financial bonanza around lumber had largely fizzled by the time royalties were finally raised in the second half of 2022.
With lumber prices now into more normal ranges, the province has decided to roll back royalties as well.
But unlike the increases, which took effect last September after months of deliberation and the 60-day waiting period observed before changes in fees are normally implemented, reductions will be faster than immediate. They are to take effect retroactive to April 1st.
That irks Bell, who said the speed at which royalty rates are being cut is in stark contrast to the indecision and delays that preceded raising them.
"They certainly didn't put the rates up very fast when the prices went up, but they sure put it down fast when the markets aren't as good," said Bell.
"It's typical of what the government does. I am just astonished at the rates that the government uses for this taxpayer asset."
Natural
Resources and Energy Development Minister Mike Holland publicly
announced when timber royalties were increasing last summer, but his
department did not respond to questions last week about plans to cut
them. (Jacques Poitras/CBC)
New Brunswick forestry companies cut a variety of trees of differing values from publicly owned land every year.
The most lucrative are spruce, pine and fir trees large and straight enough to be cut into lumber. In a typical year, companies cut three million cubic metres of softwood for sawmill use from public land.
About 850,000 cubic metres of those amounts are softwood sawlogs, which carry a current royalty of $40.60 per cubic metre. That was raised from $31.09 last year, but is now proposed to fall to $21.83.
Royalties on softwood sawlogs in New Brunswick have not been that low since 2012.
That is causing some confusion in the forestry sector, since higher royalties were meant to help finance a new private woodlot sustainability fund, announced by the province six months ago, that is supposed to help smaller private owners of forests manage their lots more efficiently.
New Brunswick companies cut millions of trees annually from publicly owned forests and in exchange pay the province royalties. (Radio-Canada)
Kim Jensen, general manager of the Carleton-Victoria forest products marketing board, said she doesn't know if the fund is still to be paid for by royalty rates or some other surcharge or mechanism the province hasn't explained yet.
"We've heard nothing. It's been dead silence," said Jensen.
Not all rates are declining, however.
There is a proposed 34 per cent increase in poplar and hardwood pulpwood royalties. Based on traditional volumes, that could add $2.2 million in revenue to offset some of the reductions.
The public has until May 24 to comment on the proposed changes.
ABOUT THE AUTHOR
David Amos
We get the governments we deserve when apathy rules the day eh?
I say no way
What say you?
Regulator takes control of Sussex woodlot owners group
SNB Marketing Board locked in a decade-long battle with J.D. Irving Ltd.
Connell Smith · CBC News · Posted: Aug 16, 2019 7:00 AM ADT
N.B. Power to spend $3.4 million of proposed rate hike on higher industrial subsidies
Utility's planned 8.9 per cent rate increase applies to all customers, except 6 pulp and paper mills
Robert Jones · CBC News · Posted: Oct 11, 2022 6:00 AM ADT
The demographics in that riding have change quite a lot in the last 4 years.
Many are those who don’t vote regularly but who will vote to get rid of an MLA who’s passed his best before date.
It's like you don't even know how to run a province.
Reply to Inger Nielsen
Decision allows J.D. Irving Ltd. to bypass SNB negotiators to deal directly with woodlot owners
Connell Smith · CBC News · Posted: Dec 10, 2018 4:00 AM AST
New Brunswick lumber companies quietly shattering income records
Salisbury sawmill owner flooded with calls for wood
Robert Jones · CBC News · Posted: May 03, 2021 6:00 AM ADT
Transportation certificates are used for tracking wood movement and controlling theft
Connell Smith · CBC News · Posted: Jan 29, 2018 5:00 AM AST
Regulator takes control of Sussex woodlot owners group
SNB Marketing Board locked in a decade-long battle with J.D. Irving Ltd.
Connell Smith · CBC News · Posted: Aug 16, 2019 7:00 AM ADT
Re:Whereas some of you were blocked I blogged it ATTN David Duncan Young I just met your nasty little buddy Chris Spencer of SNB tonight
David Amos<david.raymond.amos333@gmail.com> | Wed, Sep 5, 2018 at 10:18 PM |
| To: david.young@mcinnescooper.com, snb@nb.aibn.com, devans@coxandpalmer.com, markandcaroline <markandcaroline@gmail.com>, Newsroom <Newsroom@globeandmail.com>, news <news@kingscorecord.com>, nbfwo@nb.aibn.com, news <news@dailygleaner.com>, "steve.murphy" <steve.murphy@ctv.ca>, "brian.gallant" <brian.gallant@gnb.ca>, "Davidc.Coon" <Davidc.Coon@gmail.com>, davidcoon <davidcoon@greenpartynb.ca>, leader <leader@greenparty.ca>, leader <leader@greenparty.pe.ca>, leader <leader@greenparty.bc.ca>, "serge.rousselle" <serge.rousselle@gnb.ca> | |
| Cc: motomaniac333 <motomaniac333@gmail.com> | |
http://davidraymondamos3. Wednesday, 5 September 2018ATTN David Duncan Young I just met your nasty little buddy Chris Spencer of SNB tonight Political Debate on Forestry Related Concerns / Solutions (Video 1/2)
All-Party debate September 5, 2018 Hosted by New Brunswick Federation of Woodlot Owners Location: Sussex, NB Hosts: SNB
Political Debate on Forestry Related Concerns / Solutions (Video 2/2)
Published on Sep 6, 2018  Chris Spencer, CFT General Manager Chris Spencer began working in the Private Forestry Sector in 1986. He graduated from MFRS (Ranger School) in 1985. Cell #: (506) 432-1493 Email: chris.spencer@snbfpmb.ca https://ca.linkedin.com/in/chris-spencer-65a2524a Chris Spencer Manager at SNB Forest Products Marketing Board Sussex, New Brunswick, Canada 154 followers 155 connections Experience SNB Forest Products Marketing Board Graphic Manager SNB Forest Products Marketing Board Jan 2020 - Present 3 years 5 months Sussex, New Brunswick SNB Wood Co-operative Ltd. Graphic Silviculture Manager SNB Wood Co-operative Ltd. Apr 1986 - Jan 202033 years 10 months https://snbwc.ca/about ---------- Original message ---------- From: David Amos <david.raymond.amos333@gmail. Date: Wed, 5 Sep 2018 20:52:52 -0400 Subject: ATTN David Duncan Young I just met your nasty little buddy Chris Spencer of SNB tonight To: david.young@mcinnescooper.com, snb@nb.aibn.com, devans@coxandpalmer.com, markandcaroline <markandcaroline@gmail.com>, Newsroom <Newsroom@globeandmail.com>, news <news@kingscorecord.com>, nbfwo@nb.aibn.com, news <news@dailygleaner.com>, "steve.murphy" <steve.murphy@ctv.ca>, "brian.gallant" <brian.gallant@gnb.ca>, "Davidc.Coon" <Davidc.Coon@gmail.com>, davidcoon <davidcoon@greenpartynb.ca>, leader <leader@greenparty.ca>, leader <leader@greenparty.pe.ca>, leader <leader@greenparty.bc.ca>, "serge.rousselle" <serge.rousselle@gnb.ca> Cc: motomaniac333 <motomaniac333@gmail.com> http://www.snbwc.ca/index.html https://www.mcinnescooper.com/ https://ca.gofundme.com/legal- Manager: Susannah Banks 680 Strickland Lane, Fredericton, NB E3C 0B5 (506) 459-2990 Email nbfwo@nb.aibn.com Legal Defense Fund;Private Woodlots ---------- Forwarded message ---------- From: David Amos <motomaniac333@gmail.com> Date: Sat, 12 Aug 2017 13:40:21 -0400 Subject: Attn Douglas A.M. Evans, QC RE JDI vs SNB I just called your cell phone and left a voicemail introducing myself Correct? To: devans@coxandpalmer.com, david.young@mcinnescooper.com, psteep@mccarthy.ca, jean.bertin@gnb.ca, keith.mary@jdirving.com, pfolkins@snbwc.ca, Krishna.K@avg.adityabirla.com, daniel.wilcock@canada.ca, "rick.doucet" <rick.doucet@gnb.ca>, nbfwo@nb.aibn.com, "Hon.Chrystia.Freeland" <Hon.Chrystia.Freeland@canada. <Hon.Dominic.LeBlanc@canada.ca>, "david.wilkins" <david.wilkins@nelsonmullins. <Jacques.Poitras@cbc.ca>, "Jack.Keir" <Jack.Keir@gnb.ca>, "greg.byrne" <greg.byrne@gnb.ca>, jcharest@mccarthy.ca, "Larry.Tremblay" <Larry.Tremblay@rcmp-grc.gc.ca markandcaroline <markandcaroline@gmail.com>, andre <andre@jafaust.com>, COCMoncton <COCMoncton@gmail.com> Cc: David Amos <david.raymond.amos@gmail.com> <brian.gallant@gnb.ca>, briangallant10 <briangallant10@gmail.com>, "David.Coon" <David.Coon@gnb.ca>, "Davidc.Coon" <Davidc.Coon@gmail.com>, "randy.mckeen" <randy.mckeen@gnb.ca>, "mckeen.randy" <mckeen.randy@gmail.com>, "blaine.higgs" <blaine.higgs@gnb.ca>, "jake.stewart" <jake.stewart@gnb.ca>, "kirk.macdonald" <kirk.macdonald@gnb.ca>, BrianThomasMacdonald <BrianThomasMacdonald@gmail. http://www.coxandpalmerlaw. Douglas A.M. Evans, QC Acts as counsel in the Saint John office of Cox & Palmer DIRECT LINE (506) 633-2757 Cell: (506) 640-0632 E-MAIL devans@coxandpalmer.com Perhaps you should review my blog for the benefit of your clients the AV Group? It appears to me they don't know how to read Engish. I know for a fact that they do bother to answer emails or even return phone calls in order to introduce me to their lawyer Obviously I had to wait months for CBC to spill the beans and tell us all who you are N'esy Pas Premier Gallant, Mr Higgs and Mr Coon??? http://davidraymondamos3. Saturday, 18 February 2017 Lets see if CBC allows me to post my comments agreeing with others and their opinions of the Irving Empire Need I say HMMM? ---------- Original message ---------- From: David Amos motomaniac333@gmail.com Date: Mon, 6 Feb 2017 14:18:56 -0400 Subject: RE JDI vs SNB To: psteep@mccarthy.ca, bdsaw@mccarthy.ca, jcharest@mccarthy.ca Cc: David Amos david.raymond.amos@gmail.com ---------- Original message ---------- From: "Gallant, Premier Brian (PO/CPM)" Brian.Gallant@gnb.ca Date: Mon, 6 Feb 2017 16:10:07 +0000 Subject: RE: Yo Chucky Leblanc RE latest JDI lawsuit Here is scoop for ya the media won't touch BTW I called your old pal Jeannot Volpe at (506) 737 4436 and left voicemail just so he can't say I talked behind his back N'esy Pas? To: David Amos motomaniac333@gmail.com Thank you for writing to the Premier of New Brunswick. Please be assured that your email will be reviewed and if a response is requested, it will be forthcoming. Nous vous remercions d’avoir communiqué avec le premier ministre du Nouveau-Brunswick. Soyez assuré(e) que votre courriel sera examiné et qu’une réponse vous parviendra à sa demande. | |
https://davidraymondamos3.blogspot.com/2019/08/regulator-takes-control-of-sussex.html
Monday, 19 August 2019
Regulator takes control of Sussex woodlot owners group
David Raymond Amos @DavidRayAmos
Replying to @DavidRayAmos @alllibertynews and 49 others
Methinks Bill Richards and his cohorts can cry me a river after denying me the right to debate Bruce Northrup his buddies during the last election N'esy Pas?
https://davidraymondamos3.blogspot.com/2019/08/regulator-takes-control-of-sussex.html
https://www.cbc.ca/news/canada/new-brunswick/woodlot-owners-cooperative-marketing-board-irving-commission-1.5248448
Regulator takes control of Sussex woodlot owners group
SNB Marketing Board locked in a decade-long battle with J.D. Irving Ltd.
The commission, the official regulator of the province's seven woodlot owners marketing boards, now functions as SNB's board of directors.
SNB chair Bill Richards likened the takeover to putting "the fox in charge of the chicken coop."
SNB board chair Bill Richards says the takeover at SNB is like the 'fox guarding the chicken-coop.' (CBC)
"We're nervous that the forest products commission much more represents industry than it does the marketing board, and here they are in control of the marketing board at this point," said Richards.
For much of the last decade SNB has been locked in a battle with J.D. Irving Ltd., AV Group and a number of Irving contractors over efforts by forestry companies to bypass wood-price negotiators at the marketing board and buy logs directly from individual woodlot owners.
- Appeal Court backs Irving in dispute with wood marketing board
- At loggerheads: J.D. Irving and other forest companies take an axe to the longtime marketing board system
In addition, Irving alleged the marketing board has a conflict of interest because it also operates a co-op of woodlot owners that competes with those members of the marketing board who have chosen to sell their wood to JDI.
In a December 2017 decision, the commission found largely in favour of the arguments raised by the Irving and AV-led group.
The decision was then upheld by New Brunswick's Court of Appeal in a December 2018 decision.
Moved too slowly for regulator
The formal takeover of SNB's board of directors took place at the end of May after the commission concluded the woodlot group was not moving fast enough to separate its co-op and marketing board operations."This action has been very disruptive to the democratic system that marketing boards operate under and shows no respect for the woodlot owners that elected these people to represent them," said Susannah Banks, executive director of the New Brunswick Federation of Woodlot Owners.
"We also have concerns about the overall structure of the commission and the high potential for conflict of interest among certain commission members."
AV boss's role questioned
Banks said a member of the commission, Michael O'Blenis, is also a senior manager at AV Group.
O'Blenis refused to talk to CBC News, referring questions to the Forest Products Commission.
The commission's executive director, Tim Fox, said questions raised by CBC would be discussed for response at an Aug. 19 commission meeting.
"This is not exclusively a JDI issue," said J.D. Irving spokesperson Mary Keith, referring questions to the Forest Products Commission and the Court of Appeal's decision.
About the Author
Commenting is now closed for this story.
David R. Amos
Methinks Bill Richards and his cohorts can cry me a river after denying me the right to debate Bruce Northrup his buddies during the last election N'esy Pas?
Marc Bourque
I don’t like the sound of that « commission « Who’s in charge the Gambinos?
David R. Amos
"Commission chair Brian Mosher said a decision will be issued at a future date."
https://www.cbc.ca/news/canada/new-brunswick/jdi-woodlot-board-commission-1.4242677
Private wood supply 101- Fairness explained
One of the issues garnering interest heading into the fall sitting of the legislature is the repeated call to modernize the crown land and forests act (CLFA). Especially vocal in this call is the New Brunswick Federation of Woodlot Owner’s (NBFWO) President, Rick Doucet. In a recent NBFWO blog authored by Mr. Doucet there is a repeated cry for fairness for private woodlot owners to access markets where they can offer their wood for sale. It asserts that government, in particular the current and previous ministers of ERD, have not upheld a provision of the CLFA relating to proportional wood supply from private wood sources. It also proposes that this failure to uphold proportional wood supply led to New Brunswick not receiving exclusion from softwood lumber tariffs imposed by the U.S. Department of Commerce.
The assertion is compelling but requires a closer look to understand why this apparent discretionary action by government in not applying the provision, in effect, saved the industry in New Brunswick from an irrecoverable demise and in the process salvaged the very market that is being fully accessed by private woodlot owners today. Troubling as it is, the Federation’s very public assertions plays directly into the U.S. Lumber Coalition’s argument alleging subsidy of the New Brunswick softwood lumber industry. It is this constant undermining of the forest sector, based on a narrow and outdated view of forest product marketing, that does a disservice to Federation members, the forest sector and New Brunswickers as a whole.
Private wood supply has returned to its 2005, pre-recession level of approximately 2million m3 annual harvest. That’s about 20% of the wood supply not 15% as reported by Mr Doucet. In total about 48% of wood supply is derived from crown with a slight majority (52%) from a combination of small private (20%) and private industrial freehold (32%). The U.S. department of commerce allegations remain un-founded and the Federation seems oblivious to how damaging their support of those allegations are to the entire sector including themselves.
To understand why private wood supply decreased in the last decade you need to go back to the period between 2003-2012. In those first three years lumber markets were raging as subprime loans in the overheated U.S. housing market sent lumber demand and prices skyrocketing. Mills ran full out, and while crown and freehold stayed within their allowable cut, private wood supply was exceeding sustainable harvest levels by 20% to meet the demand, according to DNR wood utilization figures at that time. Interestingly enough, this data directly contradicts Mr Doucet’s assertion of “excessive use of public forests by private industry.” It would seem quite the opposite.
What was not bargained for was the great recession that reared its head in 2006 and would impact the sector until 2012. In its wake, lumber markets crashed, sawmill production fell off resulting in increased chip costs for pulp mills as chip production fell and contributed to the closure of four pulp mills and over half of the sawmilling capacity. That market prices for wood fiber came off should not come as a surprise to anyone, nor should the significant exit of private woodlot owners willing to offer their wood at reduced market values. That’s how the market is expected to work.
This was a full-blown crisis and required intervention by government of the day to avert complete collapse of the sector. The solution was to rationalize the industry by buying out mills on the brink of closure and redistributing their crown wood allocation. This was not additional wood. As private wood left the market in reaction to low prices this inflated the proportion of total wood represented by crown and freehold. Crown wood supply actually decreased in total volume by 16% from 2005-2009, private wood substantially more but it was a willing withdraw due to low prices at that time. This is not a criticism of that decision as it is a fair reaction to a free market situation by private woodlot owners. Prices paid for Crown wood remained based on the fair market value for private wood, a cost that was nearly 200% that of the Canadian weighted average.
Returning to references in his blog regarding government acknowledgment of public desire for more conservation, less herbicide and clear cutting, Mr Doucet panders to public sympathy by a thinly veiled innuendo that these latter practices are shunned by private woodlot owners and are strictly in the domain of big bad industrial forest managers when the fact is many excellent private woodlot managers use these tools to optimize outcomes on their land including timber production. This is the value add we speak of and that could improve profitability and more importantly sustainability for many private woodlot owners. We would encourage the Federation to promote more management and we support their efforts to move this forward.
There are opportunities to help each other realize better returns but it needs to start with the understanding that fairness includes being able to deliver wood supply sustainably and predictably and not position yourselves as only interested in supplying wood at the marginal prices. Equally important is understanding that private wood supply requires a willing buyer and seller and that the freedom remains for either party to walk away when the value offered or received is not present. Legislated proportional wood supply is simply a form of supply management and that inevitably always favors the seller at the buyer’s expense.
That’s not fair.
Mike Legere, Executive Director of Forest NB
THE CURIOUS CASE OF THE FOREST PRODUCTS COMMISSION
July 24, 2020
In his pledge to improve opportunities for woodlot owners in the province last year, Natural Resources and Energy Development Minister Mike Holland promised to examine the role of the New Brunswick Forest Products Commission.
“The commission has long failed to fulfil its duty to act as an effective intermediary
This was a welcome step. For years now, we’ve been deeply concerned. Not many folks know much about the commission and how it is supposed to operate, but we know all too well.
We’re concerned the commission has long failed to fulfil its duty to act as an effective intermediary between industry, government and woodlot owners. We aren’t the only ones – we’ll get to more on that in a moment.
GOVERNMENT MUST ACT
A creation of government and the overseer of the province’s private wood supply, the commission is supposed to be a referee – ensuring access to market and a process for negotiating reasonable prices.
“The commission is supposed to be a referee...It has clearly not been that referee.
It has clearly not been that referee. Consider that only a fraction of private wood in New Brunswick makes it to market and that the prices woodlot owners get for their hard work are woefully low.
So we were encouraged that Minister Holland and the Higgs government pledged to fix it. Unfortunately, we’re still waiting – not just for the reforms but any details at all with what the government plans to do.
This was announced in December – we’re now into the heat of summer. We understand that the pandemic has been a major focus, and the government has proved it can act quickly and decisively to deal with it.
ECONOMY IS SUFFERING
But there isn’t time to waste on these reforms either. New Brunswick’s economy is suffering. Unlike many other sectors, forestry was not forced to shutter. Indeed, pulp and paper became essential in dealing with the pandemic and now consumers are reporting shortages in lumber.
“Speaking volumes is the forest products commission’s refusal to meet with us.
We’re concerned that the government is now telling us they need new data on the flow of wood within the province today and into the near future. This is a needless delay – mountains of data already exist.
A healthy forestry industry is critical to our province.
Something is seriously wrong when the 42,000 private woodlot owners in this province are treated as second-class instead of being welcomed as partners in ensuring a stronger future for forestry in New Brunswick.
Speaking volumes is the forest products commission’s refusal to meet with us to discuss concerns and suggestions for how to improve the state of forestry in New Brunswick. So much for a fair and even-handed arbiter of the system.
TIME FOR FAIR PRICES
Consider that we haven’t been able to fetch a fair price in years as the commission, under successive governments, has allowed big forestry companies to take a bigger and bigger share of the Crown forests at cheap prices, and has allowed those same companies to make an end-run around the marketing boards that are in place to ensure fair pricing.
“The commission needs to look at wood flow – we should not see lower prices for private wood because someone took it upon themselves to fill their yard with Crown wood
The commission is not using its broad powers to ensure a fair, balanced timber market where private wood resources are optimized. Instead, industry routinely goes around, rather than through, the marketing boards.
Some of the current problems are caused by direct contracts and by industry’s ability to manipulate their inventories to drive prices down or shift markets altogether. The commission needs to look at wood flow – we should not see lower prices for private wood because someone took it upon themselves to fill their yard with Crown wood. That should never happen.
NEW BRUNSWICKERS PAYING THE PRICE
The oversupply of timber from Crown lands has allowed U.S. officials to claim market distortion, leading to punitive duties and tariffs. In the face of millions of dollars in U.S.-imposed penalties, the provincial government insists that New Brunswick has a fair lumber market. Much to our chagrin, it does not. All New Brunswickers are paying the price for that.
“The provincial government insists that New Brunswick has a fair lumber market. Much to our chagrin, it does not.
Established in 1971, the commission has broad authority under the Forest Products Act and the Natural Products Act to investigate production costs, recommend prices, act as a conciliator, arbitrator, and adjudicator, and “conduct inquiries into any other matter related to primary forest products.” One of its main objectives is “to encourage and facilitate the optimum utilization of private woodlot resources.”
We aren’t the only ones left to wonder why it hasn’t been doing this. The government-commissioned Private Forest Task Force report noted that the commission has the potential to be the province’s most important organization for providing market information and resolving disputes about prices and market share.
POTENTIAL ‘LARGELY UNFULFILLED’
“However,” the task force report states, “its potential is largely unfulfilled.”
“Every day that goes by under a broken and dysfunctional system costs all New Brunswickers.
As well, Auditor General Kim MacPherson has highlighted serious “deficiencies” in the private wood oversight functions of both the commission and the provincial government’s natural resources department.
This is a curious case. Why, one wonders, is this happening? It may well be that the commission does not have the right resources, processes and people in place.
It would seem the government agrees.
“The government will evaluate options to refocus the New Brunswick Forest Products Commission to ensure its purpose and powers are implemented and well-functioning,” Minister Holland announced last December in unveiling his intentions to give private woodlot owners a larger role in the forestry industry once again.
“Our government’s vision is to have private woodlot owners active in the management of their property, committed to long-term sustainability, viewing their woodlots as assets and proud to be involved in forestry in this province,” he said. “Forests are part of our heritage and we want more people participating in forest management. This will be good for the forest and the economy.”
We could not agree more, so let’s get moving. We don’t need more bureaucracy and delay – we need action. We need fairness. Every day that goes by under a broken and dysfunctional system costs all New Brunswickers.
Thanks for listening,
Rick Doucett President, New Brunswick Federation of Woodlot Owners
News Release
Legislation passed to support private woodlot owners
19 December 2022FREDERICTON (GNB) – The provincial government has passed legislation that will allow additional royalties to be collected to add to the Private Woodlot Sustainability Fund starting this summer.
The fund will be used to bolster efforts to improve the management of private woodlots, contribute to environmental conservation, recreation as well as quality of life.
“Our forests are a vital part of our economy and environment,” said Natural Resources and Energy Development Minister Mike Holland. “Considering private woodlots make up 30 per cent of our forests, a productive, well-managed private woodlot sector is important for the overall health of our economy and environment, the quality of life of woodlot owners, and a vibrant and sustainable forest industry.”
The Private Woodlot Sustainability Act allows the government to make upward adjustments to Crown timber stumpage so that more money can be invested in private woodlots. This will provide woodlot owners with improved services.
“We are very pleased that this government is making a commitment for significant investment in the private woodlot sector in this manner,” said Rick Doucett, president of the New Brunswick Federation of Woodlot Owners. “It has been difficult for woodlot owners to perceive their future with optimism and confidence as past government initiatives have eroded their ability to do so. This is an excellent step in restoring that optimistic outlook for the future. We look forward to continuing the work with government on the challenges facing private woodlot owners here in New Brunswick and we applaud this government for taking positive action on this important file.”
The funding is intended to build confidence among private land contractors and expand the long-term supply of fibre for the province’s wood processing facilities.
“Our vision is to have private woodlot owners well supported in managing their property and helping the long-term sustainability of this resource. There are challenges in the private woodlot sector that need to be addressed and this work requires funding,” said Holland. “The Private Woodlot Sustainability Fund will support better management of private woodlots.”
People looking for more information on the fund or with suggestions related to the management of private woodlots can email privatewoodlots@gnb.ca.
Media Contact(s)
Nick Brown, communications, Department of Natural Resources and Energy Development, nick.brown@gnb.ca.
“I Am All For The Little Guy Being Able To Make A Living”
- Olivia Bates
- August 10, 2022
Private woodlot owner, lumber miller responds to Crown stumpage rate increase
A private woodlot owner and lumber miller says the new Crown land stumpage rates announced last month will help smaller-scale operators like him make a better living from the woods.
“The higher timber prices at the mills is far overdue and, if anything, should be increased more,” Sussex-based private contractor Adam Spinney recently told the Conservation Council.
Last month, Minister MIke Holland announceed that Crown stumpage rates would increase for the first time in about seven years.
Spinney said that even though he has a woodlot, he’ll occasionally purchase logs to keep his sawmill business going when demand is higher than he can harvest on his own—so the 30 per cent increase will likely drive costs up for that side of his business.
“I’m okay with that,” he said.
“I am all for the little guy being able to make a living with some hard work but over the past decade that’s has proven to be impossible. Unless you have a million dollars to invest in harvesters and transporters it’s awful hard to make a go with a chainsaw and tractor.”
Spinney’s comments echo those made by independent foresters the Conservation Council interviewed for our 2017 NB Forest Report Card.
Rick Doucett, president of the New Brunswick Federation of Woodlot Owners (NBFWO), told Global New Brunswick that the temporary stumpage rate increase, along with a new system to adjust rates on a monthly basis, should produce a more competitive market for private sellers.
“It’s a great first step to create that pathway and the next step we need to take is how can we create enough value for the wood that the growers, the cutters and the truckers can make some money, but also the industry can make money,” Doucett told reporters when the changes were announced last month.
“It’s about finding that sweet spot where everybody is making a little bit of money.”
The NBFWO and others have been calling on government to increase Crown royalties, especially as prices skyrocketed and large mills made record profits over the past two years.
It was only early last month that Minister Mike Holland announced the temporary 30 per cent hike from $27 to $37 per square metre harvested on Crown land.
Holland said new legislation “that creates fair market value and an upward adjustment based on commodity rates going forward” will be introduced this fall and come into effect next April.
New Brunswick’s independent foresters have been in the shadow of large forestry companies for decades. As Spinney said, we’re hopeful that the coming changes will mean our independent foresters can finally make a good living from the woods again.
Learn more about forestry reform and nature protection in N.B.
Rick Doucett
Manager, Transmission Vegetation & Environmental Support at NB Power
New Maryland, New Brunswick, Canada
New Brunswick hikes Crown timber fees 30 per cent
Cost to harvest timber on government land going from $27 to $37 per square metre
It's part of promised changes the province is making to its Crown timber royalty fee system, which are expected to result in an additional $50 million this fiscal year once it takes effect later this month, said Natural Resources and Energy Development Minister Mike Holland.
Holland had already revealed his change in direction on the issue of royalties, but the details had not been worked out.
"We haven't adjusted timber royalty rates in a number of years and this was an opportunity for us to apply a timber royalty rate that we feel fairly reflects the significant increase in the commodity pricing," he said Wednesday.
"And it will be part of a larger strategy to move towards legislation that creates fair market value and an upward adjustment based on commodity rates going forward."
The legislation is set to be passed this fall and implemented next April, and will give the province's Forest Products Commission the ability to conduct monthly fair market value surveys in order to keep a more "real-time" pulse on whether the Crown royalty fees are reasonable.
The legislation will also give the province the power to include additional "upward adjustments" on timber royalties based on commodity prices for lumber.
Holland
said the government increased the Crown timber royalty fee to more
fairly reflect the significant increase in the price of lumber. (CBC)
That extra revenue from the commodity price adjustment will be reinvested in the province's private woodlot sector through improvements to silviculture practices and providing better resources and education to those in the industry.
The move comes two years after the price of lumber spiked in 2020 and went on to peak in May 2021, leading to record profits for New Brunswick forestry companies.
However, while other provinces like Alberta and British Columbia increased the fees they charged companies for harvesting timber on their land, the province left its rate unchanged from where it was set in 2015.
That garnered criticism, particularly from private woodlot owners, who accused the province of essentially putting a ceiling on the price they were able to sell their timber to saw mills for.
Holland said he was aware of calls to tie royalty fees to lumber commodity prices, but said doing so could have "unintended consequences" if the price of lumber went back down.
"That's why we said we don't want to do something where if we put something in place that follows commodity pricing, where will it put us if the commodity pricing goes down?
"And so we said security, stability, surety is very important in this marketplace. So I was I was very clear that we weren't going to adopt a system that didn't have the ability to provide that stability."
As for the 30 per cent increase on royalty fees set to take effect, Holland said this was based on a formula the department used that took into account recent market fluctuations.
It resulted in the province's decision to charge companies on average $37 per square metre, up from $27, Holland said.
"We came up with something that took the last two years into consideration to apply to a timber royalty increase for this year to allow us to move into a transition year to get to the point where we can prepare that legislation and come forward with that consistent model that will be applied year after year," he said.
Woodlot federation pleased
Private woodlot owners complained during the past two years that they were missing out on the profits enjoyed by large forestry companies as a result of the extreme spikes in the price of lumber.
That's because, according to them, the Crown timber royalties charged by the province to private companies were unfairly suppressing the price at which they could sell their own timber to saw mills.
Susannah Banks, executive director of the New Brunswick Federation of Woodlot Owners, acknowledged the increase in the royalty fee is late, but said she's happy it's finally come.
"As you increase the price of Crown wood, it makes it easier for woodlot owners to negotiate for a better price for themselves," she said.
"And also ... we'd like to see the province have more revenue as well, but it's very encouraging to see that at least they're recognizing that private landowners are not making enough to justify the sort of investments back into silviculture that are made on Crown and industry."
Industry accuses government of being non-transparent
Slightly more than half of the wood New Brunswick forestry companies use in their operations is owned by the province. The rest comes from a variety of sources, including industry's own forest holdings and thousands of smaller independent suppliers.
On Wednesday the New Brunswick Lumber Producers issued a statement on behalf of its members, which include J.D. Irving Limited, Marwood Ltd., and Twin Rivers Paper Co.
Softwood
logs are loaded for processing at the J.D. Irving Ltd. sawmill in
Chipman. New Brunswick wood product mills made a record $2.6 billion in
2021 but paid the same timber royalty rates they did in 2016. (Gerard Sirois/GNB)
In it, Jerome Pelletier, vice president of J.D. Irving's sawmill division and chair of the group, said they understand the province wanting to increase royalty rates on Crown timber when commodity prices are extraordinarily high.
"Nevertheless, we are disappointed by the lack of transparency and details associated with the Government's proposal," he said
Another part of the statement not attributed to Pelletier goes on to say that if the system proposed by Holland is not properly structured, "there is tremendous potential for severe and negative impacts on the long-term sustainability of New Brunswick's forest products industry."
"A healthy forest products industry is vital for New Brunswick's economy, supporting thousands of local jobs and generating demand for Crown and private timber alike.
"Failure to implement a transparent system that is consistent with the Crown Lands and Forests Act might also have negative consequences for New Brunswick sawmills in the ongoing softwood lumber dispute with the United States."
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