Ontario Business Trends

Feb/Mar Issue

Share this...

Even though the past 14 months have been a challenge for the hardwood sector, businesses continued to provide goods and services to their customers both in domestic and international markets, showing their resiliency despite the global pandemic. With the expectation that the housing sector will remain strong both in the U.S. and Canada, housing expenditures hit new record highs in 2021. This will continue to drive the strong demand for hardwood products and lumber. It is predicted that world economies will gain more traction in 2022, which could boost hardwood lumber sales, as well. The need for railroad ties is also expected to increase this year.

Contacts also noted that Aspen demand for most grades is good. No. 1 Common and Better is selling well to interior finished goods manufacturers, and the lower grades are going to pallet producers. They add that kiln-dried inventories are low relative to market demand. As for Ash production, it is not high but edged up the last couple of months of 2021. With the rise in green lumber output, kiln-dried availability improved, although demand was not as strong as earlier in the year.

Basswood customers were left scrambling for developing supplies as production was not very high in 2021 for this species. This was due to mills focusing on higher- valued species. Kiln-dried stock demand was reported as solid, with low inventories relative to needs. 

Hard Maple has been a consistent strong seller throughout 2021, driven by the North American housing markets. Green Hard Maple output did not reach its full capacity. It was expected that it would improve early in 2022, as better logging conditions are expected with ground freezing, and manufacturers, wholesalers and secondary manufacturers are looking for more supplies. 

With the high demand for Hard Maple, this provided a boost to Birch sales on top of the strong demand for this species. Birch was being purchased as an alternative to higher-priced items, such as Hard Maple, and so kiln-dried inventories were thin, with prices rising as a result. 

With prices high for Hard and Soft Maple, business improved. Demand had been reported as strong before buyers shifted in species selection, which was driven by new home and remodeling construction. Prices continue to rise, noted contacts, and kiln-dried stocks are selling as soon as they are available. 

As was expected, the federal Finance Minister’s mid-December fiscal and economic update (the most recent report available at presstime) focused on COVID-19 and the Omicron variant fight. The political campaign promises of the last election were pushed back until the spring budget, as the government is adopting an Omicron approach to governing in the short term. The fiscal update projects a $144.5 billion (CAD) deficit for 2021-22. It commits $4.5 billion for “variant response,” which is money to be used to extend lockdown support measures and expand border testing if necessary. Other spending includes purchasing rapid tests, booster shots and antiviral drugs; and shoring up the public health system for ongoing response to COVID-19 activities such as stronger surveillance, laboratory research and emergency management operations.

To help small businesses improve air quality, the government introduced a new 25 percent tax credit to offset the cost of investing in new ventilation and air filtration equipment. Other funds will go to provinces, territories and First Nations communities for ‘ventilation-related improvement projects’ at schools, hospitals, libraries and community centers. $50 million was planned for 2021 to strengthen supply chains and address bottlenecks.

Funding was introduced in one-time payments for Guaranteed Income Supplement (GIS) recipients receiving the Canada Emergency Response Benefit or Canada Recovery Benefit in 2020 who saw their GIS payments clawed back. Additionally, funding was introduced to extend the home office expenses tax deduction over two years and increase the temporary flat rate to $500 a year.

In late fall, the skilled trades received a boost. The Government of Ontario announced $90 million in funds over three years to alleviate the skilled worker shortage. This will help shrink the growing gap in skilled tradespeople, fueled by a growing number of retirements combined with fewer youth entering the trades.

According to provincial estimates, by 2025, as many as one in five jobs in Ontario will be in the skilled trades, but the average age of people entering the trades is 29. One third of tradespeople are nearing retirement, with a projected shortfall of 100,000 construction workers over the decade.

The announcement is in response to the Apprenticeship Youth Advisors report commissioned last fall by the province. Some recommendations include providing financial support for non-apprenticeable skilled trades, establishing select secondary schools as regional skilled trades training institutes, and making it easier for employers to participate in the Ontario Youth Apprenticeship Program (OYAP). An additional $2.9 million is provided, for a total of $20 million annually, to expand OYAP.

Starting in 2022-2023, funding for pre-apprenticeship training will increase to $77 million annually. The number of hires from underrepresented groups will be increased as well for women, Black, Indigenous, and People of Color, newcomers, Francophones and people with disabilities. 

In addition to funding, the province said its new training authority, Skilled Trades Ontario, would become operational in January 2022. It’s being designed to help more young people find suitable careers in the skilled trades and complete their training faster.

By Miller Wood Trade Publications

The premier online information source for the forest products industry since 1927.

Share This
Related Articles
Import/Export Wood Purchasing News
Miller Wood Trade Publications

Lake States Business Trends

Across the Lake States region, sources that were contacted at the time of this writing all agreed, but one, that their markets were doing just

Read More »
Import/Export Wood Purchasing News
Miller Wood Trade Publications

CHB Spotlights Success, Ongoing Programs

The 2024 fall meeting of the Canadian Hardwood Bureau (CHB) was held recently in St. Louis, MO, in conjunction with the National Hardwood Lumber Association’s

Read More »
Import/Export Wood Purchasing News
Miller Wood Trade Publications

Northeast Business Trends

Mixed reports on the lumber market have been received from throughout the Northeast. In Pennsylvania, a lumber sales representative commented, “I’m going to say the

Read More »
Import/Export Wood Purchasing News
Miller Wood Trade Publications

Southeast Business Trends

In the Southeast, reviews provided by lumber representatives have been primarily negative. In Tennessee, a lumber spokesperson felt, at the time of this writing, “the

Read More »