The slump contrasts sharply with two consecutive years of strong showings in the industry. The sector contributed $1.89-billion to the province’s coffers in the 2021-22 fiscal year and is on track to raiseBenchmark prices for two-by-fours made from Western spruce, pine and fir are expected to average US$400 for 1,000 board feet in 2023, down 51 per cent from US$814 last year.
“The impacts of the mountain pine beetle infestation, forest fires and the old-growth deferral strategy have reduced the supply of timber available to the forest industry,” the government said in its budget and fiscal plan. The U.S. has levied countervailing duties in retaliation for what it deems to be unfair provincial subsidies produced by the stumpage system. In addition, anti-dumping duties are being imposed in response to Canadian lumber allegedly sold at below-market value.
The potential declines in B.C. forestry and natural gas activities are expected to be part of the trend of the broader economic slowdown. The provincial government is forecasting a 0.4-per-cent rise in B.C.’s real gross domestic product in 2023, compared with an estimated 2.8-per-cent growth last year.
Some early warning of the looming recession
100% of the cause of the slump is Trudeau covid policy.