What’s with forest industry objecting to another monopoly
To the editor:
I am responding to the Jan. 3 letter to the editor from David Lindsay, the president and CEO of the Forest Products Association of Canada. He expressed concern for the monopoly that the rail transportation system wields, and how unfair it is to forest product companies in Canada.
I find it very strange that the forest companies are very concerned when they have to do business with another business that has a monopoly that controls part of their supply chain, but are more than happy to have a monopoly and full control over the log supply to their mills.
This is accomplished by way of holding the major timber harvesting rights and controlling the BCTS program by using their own harvesting contractors as surrogate bidders.
There is not a free log market in the Interior of the province but rather a very counter productive monopoly. The corporate concentration of processing plants in B.C. is making things even worse.
Perhaps what we need is some legislation, along the lines of the proposed Fair Rail Freight Services Act before Parliament, for a fair log price and market act. This would help correct the imbalance in the business relationship between the log buyer and the log seller.
In most Interior rural communities, land owners and small timber license holders rely on the major timber tenure holders to buy their logs. As most of these large companies communicate between themselves on a regular basis, there is the unspoken collusion of price fixing that goes on to keep the price of logs artificially low. Perhaps it is not so unspoken but more difficult to prove without wire tapping the companies.
The price they pay for logs has nothing to do with the price of lumber and everything to do with how low they can keep the price they pay for wood. In my opinion this fits the definition of a monopoly.
We need to break it up by dividing up the timber resources into as many small scale timber licenses as possible.
The government needs to develop an exit strategy from the B.C. timber sales program as soon as possible. The government should not be in the logging business competing with their own citizens.
This volume should then be distributed through out B.C. through more community forests, more woodlots, and settle the First Nations claims to our resources, so we can all get on with managing our natural resources properly and with some certainty.
This would be a good way to help small scale forest operators towards a balance between themselves and the sawmill timber monopoly that the majors currently hold.
Legislation of this nature by itself, would not guarantee a fair log market, but would certainly be a major step towards correcting the monopoly that exists today. This would balance the business relationship and allow for fair business negotiations to take place.