Ontario Business Trends

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The usual slowdown for spring thaw affected logging activity. In December 2022, according to figures published, hardwood production had a 4.2 percent gain in output. In February, contacts commented there had been a lot of green grade lumber entering the market based on buyers’ current needs and was reflected in prices for green Hard and Soft Maple, Basswood, Birch and other whitewoods which were in abundance. Kiln dried sales were slow for many sales companies. Business continues to be slower to secondary manufacturers such as to the cabinet, furniture, moulding and millwork and flooring sectors and lumber distribution yards. Even though output was lower from mills, kiln dried inventories were high with several key species, and prices were responding accordingly. Contacts noted a downturn in wooden pallet and container demand.

Ash production is ample to meet buyer needs, while kiln dried stocks have not improved significantly. Inventories are ample to satisfy demand, especially for the common grades.

Birch, along with Red Oak and Cherry have been steady movers. Birch production and kiln dried inventories increased, due to mills avoiding Hard Maple. Markets for kiln dried Birch are holding up. Supplies are, however, outpacing demand.

Sales of Hard Maple are rather slow overall. Buyers are cautious with their purchases as demand is weak for hardwood products. Inventories were built up ahead of winter and so businesses have ample materials. Even though green Hard Maple production contracted the last few months, production was sufficient through late fall and winter to supply secondary manufacturers and wholesalers with more than enough grade lumber. Kiln dried inventories are elevated relative to market needs, with pricing trending lower for certain grades and thicknesses.

Soft Maple demand is also contracting, and inventories are high. Wholesalers also indicate demand is soft. Some mills are controlling green production as much as possible, but buyers are reluctant to purchase supplies beyond short term needs. Some note interest in Unselected Soft Maple was better than for colour sorted material.
Production of Aspen had increased in recent months as some mills limited Hard Maple output. Aspen production was absorbed on markets with low impact to pricing. Kiln dried inventories grew due to weak demand; thus prices edged lower.

Basswood demand eased as a result reduced demand for hardwood finished goods. Many secondary manufacturers have ample supplies including kiln dried Basswood. Purchases are controlled as some suppliers are struggling to find outlets for total production. Prices of green Basswood has gone down, while kiln dried prices are reported as pressured.

Red Oak production, according to contacts, is not keeping pace with demand for green Number 1 Common and Better. White Oak production is not very high, but demand of this species is not great. Markets are absorbing developing supplies, and prices, it is noted, for the common grades are stable.
Today, Ontario’s forest industry generates over $18 billion in revenue and supports over 149,000 direct and indirect jobs in communities across the province.

Industries across Canada are seeing a large portion of their workforce retire without the ability to replace them, as is also the case for the forestry sector. The labour force and skill shortage, according to the Ministry of Natural Resources and Forestry, is preventing the sector from realizing its full economic potential. If nothing is done, the shortage could negatively impact the socio-economic standing of hundreds of communities across the province of Ontario for many years.

To address this issue, Forests Ontario and the Ontario Forest Industries Association with support from an advisory committee, collaborated on Bridging the Gap Between Ontario’s Youth & the Provincial Forest Sector, an Employment Ontario research project (known as “Bridging the Gap”) funded in part by the Government of Canada and the Government of Ontario.

“The forestry sector is faced with labour shortages across a variety of roles, and these are expected to increase over the next five to 10 years,” said Ian Dunn, President and CEO, Ontario Forest Industries Association. “We are seeing gaps and misconceptions that prevent some youth from considering a career in the industry, which is why the Bridging the Gap research is so important.”

“While already integral to many communities today, the forestry sector will become even more important in the coming years as sustainably produced forest products are further recognized as a tool in the fight against climate change,” says Rob Keen, Registered Professional Forester and Forests Ontario Chief Executive Officer. “Looking toward to the future, we need youth in the forestry sector. Bridging the Gap research findings will enable this growing industry to better and more effectively communicate with students and young adults to identify and recruit the skilled labour the sector needs.”

Details of the research project are available on the Forests Ontario and the It Takes a Forest websites.

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By Miller Wood Trade Publications

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

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