Interfor Corporation, one of British Columbia’s most prominent forestry companies, has announced a significant relocation of its headquarters from Burnaby to the outskirts of Atlanta, Georgia. This move, revealed in a memo from CEO Ian Fillinger and reported by the Financial Post, reflects a broader trend of challenges facing the province’s forest products sector.
A Historic Shift in the Forestry Landscape
Jock Finlayson, chief economist for the Independent Contractors and Businesses Association (ICBA), highlighted Interfor’s pivotal role in B.C.’s forestry industry. He noted that the company’s gradual reduction of its presence in the province over the years culminated in this latest decision. “Most of the assets of the business are in the United States now, which I think helps to explain the move that they’ve announced this morning,” Finlayson stated.
This relocation is not merely a corporate shift; it underscores the ongoing struggles within an industry that once stood as the backbone of B.C.’s economy. The forestry sector, once a top contributor to export earnings, has been facing a myriad of challenges that have eroded its competitive edge.
Provincial Concerns and Federal Inaction
In May, Premier David Eby expressed his frustration over the federal government’s neglect of the softwood lumber industry during the allocation of a $1.5 billion relief package intended for tariff-affected sectors. His remarks were a clear indication of the provincial government’s recognition of the industry’s crucial role in sustaining both large and small communities throughout B.C.
Eby had previously asserted his confidence in the federal government’s understanding of the logging industry’s importance. However, recent developments, including the closure of Domtar’s pulp mill in Crofton—resulting in 350 layoffs—and Canfor’s decision to shut down its Northwood Pulp Mill in Prince George, which will see 300 jobs lost, suggest that the industry is in crisis.
The Regulatory Burden
Finlayson pointed out that B.C. has been gradually losing its competitive stance in the forestry sector, a trend that has been accelerating over the past 15 years. He attributes much of this decline to the current government’s policies, which he argues have not prioritised the sustainability of a thriving forest products sector. “B.C. has really lost our competitive position as a lumber and forest products producing jurisdiction generally,” he asserted.
The majority of B.C.’s forest resources are located on Crown land, giving the provincial government significant control over regulations and operations. Finlayson criticises the existing regulatory framework as being excessively burdensome, making it difficult for both new investments and ongoing operations to thrive. “We have a lot of trees. We shouldn’t really be that high-cost of a producer,” he added, emphasising the paradox of abundant resources yet high production costs stemming from regulatory constraints.
A Dwindling Future for Forestry in B.C.?
The relocation of Interfor raises concerns about the future of other companies in the region. Finlayson warned that Interfor may not be the last major B.C.-based firm to consider such a move. The combination of increasing U.S. softwood lumber tariffs and a declining fibre supply in B.C. are additional pressures that could compel other firms to follow suit.
“The government’s role has created what is probably the most difficult and costly regulatory climate for logging and wood products manufacturing, maybe anywhere in the world,” Finlayson concluded, highlighting the urgent need for a reassessment of policies affecting the sector.
Why it Matters
The transition of Interfor’s headquarters to the United States not only marks a pivotal moment for the company but also serves as a harbinger of the broader challenges facing B.C.’s forestry industry. With significant job losses and a deteriorating regulatory environment, the implications of this move extend beyond corporate strategy; they reflect a critical need for policy changes that could rejuvenate the province’s once-thriving forest products sector. As the industry grapples with these shifts, the livelihoods of countless workers and the economic vitality of many communities hang in the balance.
