OTTAWA, ON – The economic fortunes for the Canadian wood products industry are expected to make a dramatic shift for the better from an estimated $250 million loss in 2009 to a projected $660 million profit in 2010.
This improved outlook is highlighted in the Conference Board of Canada’s report: “Industrial Outlook – Canada’s Wood Products Industry – Autumn 2009.”
“After years plagued by bad news, the wood products industry is on the road to recovery,” said Michael Burt, associate director, Canadian Industrial Outlook. “Housing starts in both the U.S. and Canada are improving, which is increasing demand for Canadian wood products. The revival of the U.S. and Canadian housing markets will provide a major boost to the industry.”
After 13 consecutive quarters of production declines, the industry experienced growth in the third quarter of 2009. Production is expected to increase by almost 10 per cent in 2010. The Canadian wood products industry is expected to lose more than a quarter of a billion dollars this year, as companies were hard hit by the sudden crash in revenues.
The industry shed 9,400 jobs in 2009, bringing total job losses since 2005 to 66,500. However, cost cutting measures implemented this year will help wood producers post a profit of more than $660 million in 2010. The adoption of the harmonized sales tax (HST) in British Columbia and Ontario should help improve the industry’s competitiveness. Under the HST, wood producers will no longer have to pay taxes for production inputs such as equipment and materials, reducing industry costs and allowing them to invest in new technologies.
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