Canadian softwood lumber is expected to play a material role in hitting the federal government’s target for nearly 5 million units of new housing over the next decade. A newly announced package of federal supports for the softwood lumber sector repeats last spring’s election promise for an ambitious new package of incentives and programs to encourage investment and procurement within Canada.
“Once established, Build Canada Homes will provide financing to innovative private sector home builders in Canada that use Canadian technologies and resources, like mass timber and softwood lumber,” states a release from Prime Minister Mark Carney’s office.
That pending initiative is highlighted with other measures to address barriers that producers confront in selling to customers in the United States. Typically, nearly 60 per cent of Canadian softwood lumber is exported to the U.S., where it is now subject to anti-dumping duties of 20.5 per cent and further increases are anticipated.
The Canadian government has also pledged $700 million in loan guarantees for the forestry and softwood lumber sector, a $500-million investment to “super-charge product and market diversification” and $50 million to be channelled to affected workers through temporary enhancements to employment insurance (EI) and retraining supports. This is similar to supports recently announced for the steel industry, which also included a commitment that Canadian manufactured steel and other construction products would be prioritized for national infrastructure projects and in government procurement.
“Canada’s forestry sector is a cornerstone of our economy,” observes Minister of Finance and National Revenue François-Phillipe Champagne. “It supports nearly 200,000 good jobs in both urban and rural communities and accounts for billions in contribution to Canada’s GDP and exports every year.”
If, as envisioned, the pace of homebuilding could double to roughly 500,000 new units per year, it’s estimated an extra 2 billion board feet of lumber would be needed to meet demand over a 10-year period. As well, it’s projected that demand for structural panels could increase by 1 billion square feet.
“In the face of a changing global landscape, we are focused on what we can control — building Canada strong with Canadian expertise, using Canadian lumber,” Carney maintains.
