Squeezing more value from trees
- A solid forest resource base
- Pilot scale demonstration projects
- Bio-pathways Project Phase II
- Marketing wood's green attributes
- The power of better inventory tools
- Harnessing the collaborative power of academic R&D networks
A solid forest resource base
Three centuries ago, Canada’s newcomers were quick to recognize the rich forest resource that lay before them, covering much of the landscape from one side of the continent to the other. Over time, as the fledgling nation emerged and thrived, so did its forest industry. Canada became known around the world for the abundance and quality of its forest products.
Today, the wealth of Canada’s forest resource remains the same. Yet, what became apparent a decade ago was that how the resource was being used was no longer competitive or sustainable in the global marketplace. Many factors combined to hobble the once-vigorous industry, including a worldwide economic downturn, intensified competition from new suppliers, and increasing pressures tied to addressing environmental concerns. It soon seemed that Canada’s traditional forestry markets no longer wanted what Canada had been traditionally selling. Between 2003 and 2009, the country’s forest sector lost more than 130 000 jobs and saw 455 of its mills close temporarily or permanently.
Time for transformation
All players in the forest sector, including government, industry and stakeholders groups, recognized the need for a major transformation. In April 2007, Natural Resources Canada, working with its partners in provincial and territorial governments, industry and academia, put into motion a plan to set the sector back on its feet. The Transformative Technologies Program (TTP), as the plan is known, is being delivered by FPInnovations on behalf of Natural Resources Canada.
The aim of this comprehensive national strategy is to rebuild a vibrant, future-looking forest sector. Underpinning all aspects of the transformation agenda is a commitment to thinking, planning and acting innovatively. Innovation is the watchword of the TTP. It reflects the awareness by everyone in the sector that new thinking about what can be done with the resource on hand offers the best way forward in reviving and re-invigorating a forest sector that had lost its edge.
The global financial crisis of recent years, which emerged after the TTP's inception, has only underscored the value of the Canadian forest service having this major program of innovation well underway.
- improve the productivity and returns on existing products and services
- expand markets for existing products and services using competitive intelligence
- leverage the role of the sector as a provider of environmental stewardship
- provide new niche products and services with greater profit margins
Extract more value, add more value: two sides of the transformation coin
A key objective of the transformation strategy is to increase current and future markets for Canadian wood products—in effect, to “squeeze more value from trees.”
One way this is being done is by identifying new values in the resource and then extracting and capitalizing on those. Converting forest biomass “waste” into bioproducts is a prime example. Wood previously deemed of little use, such as that left behind from harvesting activities, milling operations and pest infestations, is now being turned into products and services for the rapidly growing bioeconomy.
Another approach to “squeezing” is by asking what consumers want and then finding new or better ways to add those values to products. These days, for example, a forest product’s “environmental footprint” is as important an influence on purchasing decisions as the product’s quality and performance are. Consumers want evidence that sustainable practices were used at every stage of a product’s pre-purchase life, from growing, harvesting, milling and manufacturing to packaging and shipping.
Thinking of business as a value chain and making the best matches along the chain—matches between market needs, processing methods and the raw resource—increases the value of forest products and the value of the resource they draw upon. The goal is to apply innovative thinking all the way along the chain, examining each point through the compound lens of economic, environmental and social considerations so that the right resource is used for the right product.
This focus on extracting more value and adding more value is occurring throughout the forest sector value chain, from selective breeding to marketing. With Natural Resources Canada providing a central leadership, investment and coordinating role, the well-integrated TTP strategy is working to concentrate efforts on:
- fostering R&D of emerging and break-through technologies and processes that can lead to next-generation forest products
- identifying new uses for wood fibre and new markets for the new products and processes identified
- diversifying the sector’s product range, especially for higher value-added, specialty areas (for example, biofuels, biochemicals and nanotechnology).
It is all part of the transformative plan’s dual agenda to increase the sector’s global competitiveness with enhanced productivity and higher-end goods while at the same time practising and promoting sustainability.
A sample of the initiatives in progress:
- rolling out pilot scale demonstration projects to help develop, demonstrate and assess next-generation products and services;
- responding to fast-growing market demand for bioproducts and processes and “green” building materials;
- supporting the development and operational use of advanced inventory technologies and tools with which to help optimize fibre-to-production supply chain activities; and
- harnessing the collaborative power of academic R&D networks to accelerate high priority research of benefit to industry.
The “Canadian advantage”
Canada’s forest sector has always held in its hand two winning cards: the scale of its forests and the diversity of its forests. These assets, combined with a well-established social infrastructure, political stability and economic wealth, have long set the country apart from virtually every other one in the global forest sector marketplace.
Yet, as the sector’s slump in the past decade showed, commodity markets, just like world circumstances, never stand still. Technology and scientific knowledge change. Social expectations change. Political climates change. And forest health and resource productivity change. All have an impact on markets and on how well any player in those markets is able to stay competitive.
Today, Canada’s forest sector, now rapidly re-energizing under the TTP, is moving forward stronger than ever. It is proving again that it is the equal of its competitors in terms of technological know-how, infrastructure capacity and comprehension of market needs. On top of this, the unique “Canadian advantage” of forest scale and diversity has not gone away. This undeniable edge remains a defining strength for the sector, and is the one around which Canada will continue to build its forest sector strategies.
Federal government for the innovation-driven change in the forest sector “Budget 2010: Leading the Way on Jobs and Growth is delivering $100 million over four years under the Investment in Forest Industry Transformation (IFIT) program to support the development, commercialization and implementation of advanced technologies in the forest sector—helping create a world-class industry able to compete in the clean energy economy of tomorrow.”
“In addition, Budget 2009, the Government of Canada has committed $170 million under the ‘Investing in Canada’s Forest Sector’, a component of Canada’s Economic Action Plan, to continue the drive to transform the forest products industry by assisting in the development of next-generation forest products and expand global markets for Canadian forest products. This funding includes $40 million to develop pilot-scale demonstrations under the Transformative Technologies Program.”