A small shipment of B.C. lumber destined for India last week was yet another signal that coastal wood producers are zeroing in on new markets worldwide.
Surrey-based Jhajj Lumber shipped five containers of product to India’s Port Kandla, where it will be used for wood and door frames.
The shipment comes two months after Surrey mayor Dianne Watts’ trade mission to the subcontinent and is being hailed as a new partnership between the Vancouver suburb and one of the fastest growing nations on Earth.
“We’ve been looking to access the Indian market for years … and the hands-on approach by the mayor and councillors to personally sit in and facilitate meetings allowed us to strike an extremely important deal while we were on the trip,” said Parm Jhajj, CEO of Jhajj Lumber. “This deal represents a huge market for us and a great story for the B.C. and Canadian wood industry.”
The initial shipment totalled 175,000 board feet of lumber, and Jhajj said the company is already preparing for another shipment.
Despite the good news, BC Stats shows that India accounts for a relatively small portion of the province’s yearly lumber exports.
In 2010, the province shipped $2.5 million worth of lumber to the Asian nation compared with $668 million to China and $1.8 billion to the U.S.
Still, it’s a sign that B.C. lumber producers are weaning themselves from the American bosom, which, thanks to the U.S. housing crash, has left the province’s forestry industry nearly destitute in recent years.
But there’s a flicker of light at the end of the tunnel.
In addition to noting the dramatic increase in exports to China in recent months, industry experts are predicting a global upsurge in demand for wood fibre.
That demand is driven not only by a slow return to strength in the U.S. housing market, but also by emerging nations and new uses for wood fibre.
Companies all over the world are developing new wood-based technologies that use the forest’s resources in everything from heat and power to clothing and household goods.
Bruce McIntyre, PwC’s Canadian forest, paper and packaging leader, said demand for advanced wood-based technologies is already underway beyond Canada and is slowly increasing global demand for wood fibre.
That’s good news for B.C., which emerging nations see as a key supplier of woody biomass.
“I think they do look to B.C. as a rich fibre resource,” McIntyre said, “and that’s an attractive way to drive investment in the province and draw in capital for the industry.”
David Elstone, an analyst with Equity Research Associates, also believes there’s potential for increased competition for wood fibre worldwide.
Should that battle take place, the deck will be stacked in favour of those who control the fibre basket.
Said Elstone: “Whoever owns the fibre will be the ultimate beneficiary and has the best ability to take advantage of that.”