Forestry sector can tap into China's desire for increased quality wood, consultant saysThursday, June 17, 2010
FREDERICTON - If the New Brunswick forestry industry can overcome certain challenges, it may be able to tap into a vast Chinese demand for wood, say members of a delegation that travelled to China in May.
Representatives of the trade mission reported back to the semi-annual meeting of the New Brunswick Forest Products Association in Fredericton on Wednesday.
British Columbia currently dominates Canadian forestry exports to China but Ivy Wang, a trade consultant who co-ordinated the visit, said New Brunswick may be able to use the quality of its lumber to break into the market. She said there is a perception in the country that Canada sells its higher-grade wood to the United States and Japan, leaving its low-grade lumber for China.
"There are people who are looking for quality products. But because the West Coast is really promoting the grade-three wood, the market in China has been swamped by all this low-grade, Canadian lumber, even people who are looking for grade one or two cannot find it. And that's where our advantage is," Wang said.
If forest product companies from this province can differentiate their product from the British Columbia lumber, they can tap into the desire for increased quality, she said.
Mark Arsenault, president and CEO of the forest products association, said the New Brunswick forest industry can offer other advantages as well.
For instance, many buyers in China cut Canadian lumber into smaller pieces to make furniture. New Brunswick, which produces smaller sizes than British Columbia, could capitalize on this, Arsenault said. Buyers in the Chinese market also prefer to purchase lumber in metric sizes, which many companies in New Brunswick can produce, he said.
Arsenault noted that 30 million people join the middle class every year in China. And Canadian lumber exports to the country are doubling every year, he said, noting that most of that comes from British Columbia.
"China is rapidly growing. There's incredible potential there and we should be trying to tap into that as best we can," he said.
Based on the information gleaned from May's mission, Arsenault projects huge demand for wood products. He suggests New Brunswick companies can meet that demand, provided they can manage cultural differences and make the right business connections.
That's why he's canvassing his members for interest in a second trade mission to the country later this year, which would involve matching New Brunswick companies with potential buyers in China.
And that's where Wang's company, Atlantic Canada Business Network - which is based in Saint John and has offices in Beijing and Shenzhen - comes in. Her organization, which has 14 full-time employees, arranges meetings, provides translation services, converts marketing materials into Chinese and works to find appropriate business partners.
Business New Brunswick representative, Pierrette Battah, who participated in May's fact-finding mission, said the department is considering supporting the second mission in the fall, which would be more focused on securing immediate sales.
According to Arsenault, there is currently only one company from New Brunswick that exports wood products to China - York North Veneer Products Inc., which shipped two containers of wood veneer on a test pilot basis.
Published Telegraph-Journal Thursday June 17th, 2010
Appeared on page B2 Christine Dobbby