Even with federal funding, does the BC government want forestry to survive?

In a blow that will hurt 300 workers, their families and the city of Prince George—and will inflict symbolic pain far beyond—Canfor announced the permanent closure of its Northwood pulp mill on July 14^th.  BC Forests Minister Ravi Parmar’s press release pronounced him “heartbroken” for all concerned (not for the first, or probably last, time).  Canfor cited, as have other BC forest and pulp companies announcing curtailments or closures, “persistent challenges accessing fibre” as a principal reason. This is a made-in-BC problem, with a made-in-BC solution. Is the Forests Ministry listening? Does the BC government care to have a viable forestry and pulp industry? Or is it simply incapable of changing its own public policy to avert the sector’s unfolding disaster?

A Growing Crisis in BC Forestry

Let’s rewind to just over a month ago. Federal Energy and Natural Resources Minister Tim Hogdson announced in a suburb of Victoria, BC (Minister Parmar’s own riding) that new federal funds amounting to $400 million would be available for the beleaguered Canadian forestry sector.  He also released a forest sector Task Force report, whose first of six themes “stable access to cost-competitive fibre” could surely serve as the principal recommendation to British Columbia’s Ministry of Forests, if only Minister Parmar was receptive to the message. While the punishing tariffs levelled by the United States since last October (~45%, with a chance of reduction to 35% as of April 2026) have made some fibre extraction uneconomic at low lumber and pulp prices, myriad other problems facing forestry have nothing to do with US trade policy.

That the federal announcement was made in BC is no coincidence: part tacit acknowledgement that Ottawa’s recent support announcements for sectors feeling the bite of heightened US tariffs have short-changed British Columbia forestry; and part pointed message to British Columbia’s Forests Minister—in his own riding—on its responsibility to fix forestry policy(ies) instead of deflecting all blame to tariffs levied by the United States.

Federal Response and Policy Differences

The funding is surely welcome to the forest sector, as it supports diversification of both products and markets, and comes on top of a revised model and mechanism for backstopping loans from the Business Development Bank of Canada ($1.2 billion) to support operations, setting maximum amounts, issuing letters of credit and confirming eligibility of the pulp & paper sector. The report appears to be equally welcomed: Forest Products Association of Canada CEO Derek Nighbor called it the “most robust federal government response we have seen in years” to the sector’s core issues.  

The Minister’s release of the Task Force report and endorsement of its findings—that “the most significant barriers to competitiveness are homegrown”, including unstable access to fibre and excessive regulation are surely pointed at British Columbia. Present forestry policy in the province seems designed to throttle access to fibre on the landbase, and has caused painful and perverse outcomes: 

• ~50-60% harvesting rates of the Annual Allowable Cut (attributed by most in the sector to permitting complexity, delays, and uncertainty over potential new legislation) has meant curtailments, permanent closures, layoffs and some mills operating at below break-even levels;
• By one account at Resource Works’ “Get it Done BC” event in September 2025, Harmac Pacific pulp mill in Nanaimo had to import up to 25% of its fibre supply from the US pacific northwest to keep the mill operating and maintain employment.  

One senses the frustration by the federal Minister with the state of affairs in British Columbia, Canada’s largest forestry-dependent province. Since last August when the federal government announced its first set of forestry sector supports, high profile closures in BC include: Domtar’s Crofton pulp mill, West Fraser’s 100 Mile House sawmill, and now Canfor’s Northwood pulp mill.  The BC Council of Forest Industries pegs job losses since 2022 at 15,000 workers, with 21 mill closures (temporary or permanent) since 2023. Today, make that 22 mill closures and at least 15,300 workers.

The Impact of Provincial Policy

The structural issues facing BC forestry have existed longer than Trump 2.0 in the White House, or in fact this NDP government in Victoria. However, the present crisis has been exacerbated by provincial government policy: its micro-managing and complex approach to issuing permits for cutblocks (preparation costs for permit application has increased by an estimated 400% in four years, to $14/cubic metre); its failure to encourage innovation (which would mean ceding a greater role to the private sector); its lack of clarity concerning Indigenous roles in consultation and land use; all adding up to its breathtaking willingness to let mills close and entire communities falter all around the province because it refuses to enable reliable fibre supply to get to mills in a timely and cost-effective way.  

The entire forestry supply chain—including its most important element, the people who work in the sector—is at risk. By its inaction over the past three years, the capacity and level of interest of the responsible ministry to alleviate it is legitimately in question.

The morning after the news broke, Vancouver Sun columnist Vaughn Palmer concluded to Simi Sara on CKNW radio that the BC government has given up on the forest industry in this province.  It is hard to conclude otherwise, but mystifying nonetheless: almost-certain electoral consequences for the governing NDP, and economic and social consequences in every forest-dependent community for the dislocation inflicted by obstinate public policy and absent political leadership.

The views expressed in this article are those of the author, Karen Graham, and do not necessarily reflect the views of the Resource Works Advisory Council.

Resource Works News