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Alberta forestry companies becoming power players

EDMONTON, Alta.With a green-focused new government in power, some members of Alberta’s business sector may be gun-shy about making new investments, but that doesn’t appear to be the case with the province’s forest industry, which is supposedly not only poised for growth, but is providing alternative energy for Albertans as well.

“We’ve seen a lot of electricity generation from our industry,” said Brock Mulligan, director of communications for the Alberta Forest Products Association, “and that’s a big thing. We generate about 320 MW of green electricity, which allows us to make use of almost all of the (fibre) resource.”

What they do, basically, is use parts of the wood –such as bark and sawdust – that would previously have gone to waste, burning it to create electricity to not only help power their own operations, but also for sale.

“In a lot of cases, they have additional electricity left over from powering their own operation and they’re able to put that on the grid,” Mulligan said. He figures there are about 10 facilities generating their own power that way, with “a few more that are sort of in the process.”

Mulligan reported that Alberta’s forest sector saw growth of around 8% in 2014, which has allowed players to “make some investments at the mill level, making them more efficient and also to diversify their product base a little bit.”

Extra business puts pressure on the province’s infrastructure, of course, and Mulligan noted that the forest industry is grateful to the trucking industry for not only helping get the logs to the mills, but to help move finished product that might normally travel by rail. 

“It’s very helpful for us to have trucking capacity in that we often have trouble with reliability from the rail companies,” he said, citing the availability – or lack thereof – of rail cars coupled, sometimes, with costs.

“We’ve certainly agitated for having increased reliability from that (rail) industry because it’s critical in accessing new markets and
serving our existing customers,” Mulligan said.

“The Asian market has been a considerable asset to us as it’s developed over the past few years and we know that continuing to  access (Asia) means we have to get stuff to the coast efficiently and predictably.”

Since rail cars can be at a premium, he said, “it definitely creates a bit of a scramble, a backlog, so we need both trucks and rail to be kind of firing on all cylinders.”

On the other hand, the shortage of truck drivers is being felt in Alberta’s forests, too.

“In our industry, shipping finished product is definitely a big issue on both the logging side and the mill side,” Mulligan said. “We’ve spoken to government about that and are advocating for ways that we can train more truck drivers.”

He pointed out that his group is part of the Alberta Coalition for Action on Labour Shortages, which he said also includes the Alberta Motor Transport Association.

“It’s a group of employers from a wide variety of industries that advocate for solutions that are going to allow us to train people quickly and do what we can to meet the labour shortage in Alberta.”

Mulligan said he doesn’t anticipate having problems working with Alberta’s new NDP government. “We’ve reached out and had initial conversations with (the NDP),” he said, noting that new Agriculture and Forestry Minister Oneil Carlier hails from White Court, which Mulligan said “represents a large portion of our industry. He’s very interested in the (industry’s) future and how we can work together to maintain its strength.” 

The bottom line for Brock Mulligan is that things are good in the Alberta forest sector and will probably stay that way, which is good news for the trucking companies that work there.

“We’re working really hard as an industry to ensure that we’re sustainable,” he said, “and trucking’s going to be a huge part of that. We’re kind of interconnected because folks in (trucking) depend on us for jobs and business and we depend on them to bring our fibre in and move our product out to market. And it’s a really good relationship.”

Mulligan also thinks the sector will continue to expand.

“We’re doing everything we can to make sure our industry stays strong,” he said, noting that between 2011 and 2015 the industry invested $1.5 billion worth of capital into facilities as well as working toward diversifying its markets.

“That’s paid off,” he said, “and it looks like the US housing market is going to go on a bit of the run here in the next few months and we think that we’re well-positioned to take advantage of that.”

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1 Comment » for Alberta forestry companies becoming power players
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