Forestry: Leaving hundreds of millions of dollars on the table

MONTREAL, Oct. 29, 2020 /CNW Telbec/ – With the Quebec government about to review the province’s forest regime, environmentalists are busy trying to reduce the development of this natural resource. A new Montreal Economic Institute publication shows, however, that we could increase the harvest of our forests without undermining the renewal of the resource.

In an Economic Note entitled “Quebec Forests: Rural Regions Lose Hundreds of Millions of Dollars a Year,” MEI Economist and Director of Operations Miguel Ouellette points out that less than 1% of Quebec’s forests are harvested each year, and that the forests regenerate themselves faster than we harvest them. In fact, the province harvests just 72% of its forests’ full potential each year.

“Regardless of what Greenpeace and other NGOs say, the reality is that Quebec does not harvest its forests to their full potential, and so is leaving a lot of money on the table. Yet making optimal use of this resource would greatly contribute to the economic and social vitality of our rural regions,” says Mr. Ouellette. “We need to debunk some myths. This sector is not solely made up of large companies: 72% of industry players are small businesses, and around 90% of them are located outside of Montreal and Quebec.”

Creating good jobs

“In order to prosper, our rural regions need good jobs, and that’s exactly what the forestry industry provides. The average salary in forest management is $68,000, which is 55% higher than the province’s overall average,” adds the economist. “It is possible to substantially increase our harvest without affecting the future of our forests. That’s what we have to do in order to ensure the future of our rural regions.”

Solutions exist

“We need to increase our harvest to around 95% of the forests’ full potential, like in British Columbia. In order to get there, we should start by reviewing and reducing the minimum price of wood in areas where it does not find a buyer,” says the author of the publication. “Governments and industry should also collaborate in order to establish a more effective public forest management plan for areas where no logging is currently taking place. And finally, we need to get rid of the numerous obstacles and high costs imposed on forestry companies, since these act as restraints on rural economic growth,” concludes Mr. Ouellette.

The Economic Note prepared by Miguel Ouellette is available on our website.

The Montreal Economic Institute is an independent public policy think tank. Through its publications, media appearances, and advisory services to policy-makers, the MEI stimulates public policy debate and reforms based on sound economics and entrepreneurship.