Province announces $30 million for forestry road maintenance and wood chip innovation
Associate Forestry Minister Kevin Holland stressed the need for Ottawa to collaborate with Ontario in supporting the struggling forest products sector and preventing Kap Paper in Kapuskasing from shutting down this fall.
“We can’t do it alone,” said Holland, the MPP for Thunder Bay-Atikokan, on Friday in Thunder Bay. “We really need the federal government to get involved in supporting companies like Kap Paper.”
Holland joined Natural Resources Minister Mike Harris for a funding announcement at Domtar’s Thunder Bay sawmill on September 26, revealing $30 million for two helpful industry programs.
The operator of the Kapuskasing mill in northeastern Ontario has been threatening to close as early as October.
Kap Paper, which produces newsprint and bulk paper, borrowed $10 million from the province last January to rework the mill into a pulp, paper, and energy facility that aids sawmills by using available forest biomass. Ontario recently confirmed it will provide an extra $6-million loan extension to the company.
“We’ve done our job and we really need participation from the federal government,” said Holland.
Holland welcomed Ottawa’s $1.2-billion support for Canadian forestry announced in August but hopes to see quicker action turning that commitment into real results.
With regard to Kap Paper, Holland mentioned that they’ve been collaborating with the company for over a year, “making significant investments” aimed at finding operational efficiencies, exploring new markets, and developing new products.
Now is the time, Holland asserted, for Ottawa to match their investments dollar for dollar.
The Ford government is setting up an industry working group consisting of provincial, federal, and forest industry officials to brainstorm ways to keep this $21.6-billion revenue-generating sector thriving while maintaining jobs for its 128,000 workers.
This funding announcement included an additional $20 million added to its Provincial Forest Access Roads program. This program helps companies maintain Crown forest logging roads. The total funding available through this long-standing partnership between industry and government now exceeds $79 million this year.
The province-wide road network spans 19,500 kilometers and is crucial not only for transporting wood but also serves local residents, tourism operators, utility workers, railway personnel as well as being used as evacuation routes during emergencies. According to Holland, this funding will help ensure that this vital network remains “safe and reliable for all users.”
The province is also allocating another $10 million towards its Ontario Sawmill Chip Support Program aimed at helping sawmillers discover “new innovative markets for their wood chips,” including energy production or alternatives to single-use plastics.
The government presents this funding as a means of saving jobs within the industry amid U. S. duties and tariffs impacting Canadian lumber.
Holland hinted at more governmental initiatives aimed at fostering industry growth coming soon-including promoting a “Made-in-Ontario” brand internationally on product exports.
Ian Dunn, president-CEO of the Ontario Forest Industries Association stated no other sector has felt more impact from trade actions by the Trump administration than his organization’s 50 member companies.
Dunn noted that Canadian lumber producers have already paid out around $10 billion due to duties and tariffs so far.
With U. S. duties on Canadian lumber reaching an all-time high of 35 percent, Dunn indicated that predictions aren’t looking favorable once the U. S. Commerce Department completes its Section 232 national security investigation.
Dunn expects further tariffs targeting lumber products such as pulp and paper along with engineered wood items are likely forthcoming.
Dunn confidently claimed that U. S. actions against Canadian forestry products stem from their inability “to compete with us.”
Ontario produces “superior forest products,” he stated-a fact recognized by both U. S. firms and Western Canadian businesses which invested over $7.6 billion in capital improvements within Ontario facilities between 2012 and 2022.
Dunn highlighted Georgia-Pacific’s recent decision to invest $191-million upgrading its Englehart oriented strand board mill alongside Element 5’s investment of $107-million towards a new mass timber production line at its St. Thomas plant this year.
Dunn mentioned assurances received during meetings with Prime Minister Mark Carney and Intergovernmental Affairs Minister Dominic Leblanc confirming that protecting the lumber industry remains a top priority for Canada’s federal government.
Dunn acknowledged while exploring new markets along with product innovation would certainly benefit the industry; ultimately they still see homegrown demand remaining key-stating that Ontario wood fiber can play a crucial role in helping achieve Ford government’s target of building 1.5 billion homes by 2031.
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