1. Click to edit Master subtitle style Forest Management In Ontario Steve Allen Industry Services Officer OMNR – Forests Division November 13, 2008

2. Overview  Ontario’s Forests  Evolution of Forest Management  A glance back in time  Today’s Managed Forest  Legal and Policy Framework  Public and Stakeholder Involvement  Forest Management Planning  Forest Tenure (Licensing)  Allocation of Crown wood supplies  Preparing for Tomorrow  Drivers  Objectives  Proposed actions

3. Ontario’s Forests

4. Ontario Context  107.6 million ha  87% public land  46% natural state  66% forested  42% managed “Area of the Undertaking” (AOU)

6. Ontario’s Forest Regions

8. Quick Facts – Ontario’s Forests  2% of the World’s forests  17% of Canada’s forests  21.8 million hectares of Ontario’s Crown forest is available for forest management (20% of total Crown lands)  most common tree species: black spruce  annual allowable harvest area: 350,000 hectares (0.5% of forest, 1.6% of area allowing harvest)  average annual harvest area: 220,000 hectares (0.3% of forest, 1.0% of area allowing harvest)  average annual area of forest fires: 245,000 hectares

9. Evolution of Forest Management

10. 1960s – 1980s Crown Management Unit Era Economic / Social Climate  Industry growing  Large operational forest management workforce and budgets  Many MNR offices/regions  Economic development of north – Perceived as “the Government”  Growing public interest Planning Philosophy / Approach  Crown Timber Act and “multiple use”  Focus on “timber” management (sustained yield) with constraints  Unsophisticated plans  Limited consultation Roles and Responsibilities  Crown had a greater role – belief that “we had to do it all” due to pre 60s era  Crown led most operations – roads, nurseries, renewal, some tendered sales, etc.  On “company units”, industry planned and led access and harvest operations and occasionally did renewal under agreements Licensing System  Large number of “Crown” management units  A few “Company” management units with long term licences

11. 1980s – 1990 Forest Management Agreement (FMA) Era Economic / Social Climate  Industry to be funded for operations  Lack of Gov’t funding to meet FMA commitments in late 1980`s  Far greater sensitivity to stakeholder concerns Planning Philosophy / Approach  Planning became more sophisticated but still focused on “timber”  Shift from “multiple use” to “sustainable development”  Environmental assessment of forest management commences Roles and Responsibilities  Government transfer of operational responsibilities to industry  Private sector says “we can do it better”  Crown still managed many units – but were under funded Licensing System  Forest Management Agreements signed  “Crown” management units still exist  Some tendered sales – 1000`s of timber licences

12. 1990’s – 2000 EA - CFSA - SFL Era Economic / Social Climate  1992 – economic slow down followed by stable growth  Downsizing of MNR  “New Business Relationship” with forest industry  Growth in OSB sector – competitive processes Planning Philosophy / Approach  Final Timber EA with Terms and Conditions  New Crown Forest Sustainability Act / New Forest Management Planning Manual  A move to Sustainable Forest Management from timber management  OLL and Ontario Forest Accord Licensing System  Converted FMAs to SFLs  Converted Crown Management Units to shareholder SFLs  Priced timber administratively  Established Trusts for dedicated renewal funding Roles and Responsibilities  Transfer of responsibilities and costs from Crown to industry:  Roads – forest inventory – renewal – compliance inspection

13. 2000 – present Era of Industry Transformation Economic / Social Climate  Can $ moves toward parity with US – US housing crash – SLA 2006 - High energy costs  Sophisticated marketplace ENGO campaigns  Increasing Aboriginal demands  Forest Sector Strategy  Environmental Challenges Planning Philosophy / Approach  Forest EA renewed and revised FMP Manual (2004) Licensing System  Sustainable Forest Licences  Increasing number of shareholder SFLs  Few “Crown” management units Roles and Responsibilities  Industry says “take it back – we can’t afford it all”  Crown reassumes responsibility for:  Road construction and maintenance costs  Forest resource inventory  MNR creates Forest Sector Competitiveness Secretariat

14. Today’s Managed Forests

15. Comprehensive Legal and Policy Framework  Strategic Direction/Commitments  Legislation/Regulations  Forest policies & strategies  Forest licences  Forest management plans  Monitoring and Evaluation  Public Reporting Founded on Sound Science and Info Operations can begin

16. Public & Stakeholder Involvement  Comprehensive Land Use Planning  Ontario Forest Accord  Environmental Assessment  Environmental Bill of Rights  Forest Management Planning  Guides  Plans  Monitoring and Reporting  Committee Representation  Provincial, Regional, Local

17. Forest Management Planning  10-year forest management plan with 5- year operating plans  Activities undertaken in 46 Forest Management Units  Prepared by industry / government / local citizens committee  Mandatory public & Aboriginal consultation over 2 ½ years at a great cost - ~$1 million / plan

18. Forest Management Planning  Must ensure long-term forest ecosystem health for full range of uses and values  public involvement  emulation of natural disturbance  science-based guidelines for silviculture, environmental protection, fish & wildlife habitat management, cultural values, water quality  Legal and licence requirement  Plans directed by Forest Management Planning Manual and Guides  Determines allowable harvest levels and describes harvest, renewal, access & maintenance activities  Describes non-timber values & how they will be protected (e.g. species at risk, wildlife habitat, tourism)

19. Monitoring and Reporting Monitoring  Compliance inspection & enforcement  Forest health, wildlife populations & guideline effectiveness  Independent Forest Audit  Mandatory third party forest certification Reporting  Annual Report on Forest Management  Five-year State of the Forest Report  State of the Resource Report (e.g. caribou)  Independent Forest Audit Reports  Compliance and enforcement

20. Forest Certification  All sustainable forest licence (SFL) holders were required to be certified by the end of 2007  In 2008, 80% of Ontario’s Crown managed forest certified (24.7 million hectares)

21. Forest Industry  Primary Forest Products Sector  Pulp  Paper  Lumber  Composite Panels  Veneer  Logging Sector  Secondary Forest Products Sector (two broad sectors)  the Wood Industries  Remanufactured Products, Engineered Building Components, Millwork, cabinets, furniture, other  the Paper and Allied Product Industries  Pulp and Paper industries, Paper Box and Bag Industry  Emerging Bioproducts Sector, using forest biofibre for non- traditional forest products

22. Economic Profile (2005)  After the automotive sector, forest products are the single largest contributor to Ontario's balance of trade.  In 2005, the value of Ontario's forestry sector was $18.3 billion  $10.1 billion in pulp and paper products  $6.1 billion in sawmill, engineered wood and other wood product manufacturing, and  $2.2 billion in value-added furniture/kitchen cabinet manufacturing represented  Logging activity had an estimated value of $2 billion.  The value of forest products exports – 96% bound for the U.S.:  $8.4 billion and a $2.9 billion contribution to the provincial trade balance.  Tax contributions are about $2.3 billion, including $800 million to the province and wages and salaries (2005) were approximately $3.4 billion.  Employment (Stats Canada 2005):  84,500 direct jobs in 2005 supporting more than 200,000 direct and indirect jobs across 260 Ontario communities.  Forty are categorized as highly dependent on employment in the forest sector to survive. An additional 63 are identified as being moderately dependent.

23. Forest Tenure  Determines who gets to harvest and use trees under what conditions.  Minister allocates Crown timber to selected mills  Minister does not allocate by-products such as chips, sawdust, hogfuel, etc.  About 90% of timber supply comes from public lands in Ontario  Tenure and Licences:  Sustainable Forest Licences (SFLs)  Supply Agreements  Forest Resource Licences (FRLs)

24. Sustainable Forest Licence (SFLs)  20 year renewable licences  Most held by large companies – single entity  26 currently in Ontario  Many are long-standing tenure holders (carrying forward from FMA days)  Most are conifer-based sawmill & pulp industry  Many are multiple-mill companies  Corporate players (e.g. Abitibi-Bowater, Buchanan, Domtar, Tembec, Weyerhaeuser)  Some held by multiple companies – Shareholder SFLs  15 currently with 4-5 in the process of converting  Generally based on a shareholders arrangement and a business plan  A maturing model – some still in infancy; some still emerging; some well established  MNR initiative further to promote the shareholder SFL model – more cooperation between wood supply beneficiaries (Co-operative SFL Strategy)  Model within the model – partnerships, multi-party, small harvesting companies, variety of mills, “boards”  Must prepare forest management plans, build roads and renew forest  Must be audited every 5 years to extend licence

26. Supply Agreements  Agreement between the Province and a forest products company to Make Crown forest resources available to a mill from a supply area often encompassing several SFLs  Does not convey the right to harvest forest resources from the supply area.  Wood supply in a supply agreement is harvested by holders of SFLs or other forest resource licenses.  must agree to share costs with SFL on roads, renewal, etc.  SFLs contain conditions (Appendix E) to make available target volumes to the mill named in the Supply Agreement

27. Forest Resource Licences (FRLs)  Short term licences to harvest Crown Timber (up to 5 years), with no direct management responsibilities  When issued on SFLs; referred to as overlapping licences  Requires an overlapping agreement with SFL holder  Responsibilities for operations, information, renewal described in overlapping agreement  must agree to share costs with SFL on roads, renewal, etc.  SFL holders still responsible for operations conducted by overlapping FRL

28. Wood Disposition Process FMP Available Supply Supply Shortage Rationalization of Wood to Users Additional Supply SFL Holders Utilize SFL Beneficiaries Utilize Another Process Competitive Process Impact s Options Consultation Recommendations Implement Wood Flow Decision Ministe r Directs

29. Preparing for Tomorrow

30. Drivers for Change: Social, Economic & Environmental  Climate Change  Invasive Species  Trade disputes  Industry Transformation  Green Energy  New Forest Bio-economy  Far North Development  Aboriginal Socio-Economics  Environmental Concern/Campaigns  Rural and Northern Communities

31. Objectives for Tomorrow  Healthy forests adapting to and mitigating climate change  Community economic & social stability  Enhanced aboriginal involvement and benefits  Healthy investment climate  Bio-economy investment captured  Competitive Forest Industry

32. Actions  Strategy for New Forest Economy  Invasive Species Centre  Centre for Innovation – Bio-economy  Biofibre Directive  Implement existing programs ($1 Billion to 2010)  Climate Change Strategy & Action Plan  Implement Endangered Species Act  Strengthen Relations with Aboriginal Peoples  Far North Strategy