Forestry

Hit by the some of the lowest prices since 1995, the value of manufacturing shipments of wood products in New Brunswick decreased by 2.6% in 2000.
Production of sawn lumber decreased by 2.7% for the year, dropping to 3.4 million cubic metres.
Demand for wood products was down in 2000, as shown by a 4.4% drop in US housing starts, which led to rising inventories and a sharp drop in lumber prices.
Wood products industries represent almost 2% of New Brunswick’s GDP.
Announcements of new investments include $12 million by Weyerhaeuser, $7 million by Nelson Forest Products and $6 million by Produits Forestiers Alliance.
Negotiations are under way concerning agreements governing Canadian lumber exports, which expire on March 31st, 2001. The Maritime provinces currently benefit from an exchange of letters between Canada and the US which provides free access to the US for our softwood lumber products.
Given the continued drop in US housing starts, market conditions for 2001 are not promising as prices are expected to stay low throughout the first half of the year.

New Brunswick manufacturing shipments of paper and allied products increased by 27.7% in 2000 on the strength of good market conditions and strong world demand (US elections and Olympic Games).
The market for paper and allied products improved continually throughout 2000. Newsprint and pulp prices rose from the beginning of the year to reach their highest levels since 1995.
The paper and allied products industries account for roughly 2% of total provincial GDP.
There were several mergers and acquisitions in the pulp and paper industry throughout the world. UPM-Kymmene, one of the world’s leading manufacturers in the forestry and paper industries, bought Repap, including its Miramichi operation.
With expected capacity growth below historical trend levels coupled with strong demand, pulp and paper prices should remain favourable well into 2001.