Province Announces Forestry Transition Program

Department of Natural Resources

October 12, 2007 2:05 PM

The province will invest millions of dollars in woodlot silviculture and other forest-related initiatives as part of a new program designed to help the forest industry weather what has been called a "perfect storm" of negative influences.

The increasing value of the Canadian dollar, high energy prices, plummeting housing starts in the U.S., and changes in global market conditions have caused problems and mill shutdowns Canada-wide.

"We know that the pressures are escalating here in Nova Scotia and that our industry has been hard hit by all these factors," Natural Resources Minister David Morse said today, Oct. 12. "We also know that steps need to be taken to help ensure the ongoing health of this industry -- a key rural employer -- as it moves through this difficult time."

As part of the new transition program, the province will invest up to an additional $6 million per year in wood buyers' silviculture programs for small wood lots for 2007-08 and 2008-09. The investment will be reassessed after the 2008-09 fiscal year and funding will then be based on an index of market conditions.

The province will also work over the next several weeks to formalize the tangible capital asset budget and criteria for a land-purchase program that will allow the Crown to continue to acquire some parcels of industrial forest land where appropriate. This has been used previously as a means of providing much-needed working capital for viable mills.

"A select committee of cabinet has been struck to deal with this transition program," Mr. Morse said, "and that committee will work with a task force of industry representatives to help identify innovative new products and markets to transition profitably in to the new market realities."

Other measures in the program include:
-- a one-time payment of up to $2 million to the Maritime Lumber Bureau to cover a portion of legal costs incurred defending the province during the softwood lumber agreement negotiations
-- a total of $900,000 over three years in additional funding for the Forest Products Association of Nova Scotia Gas Tax Road program
-- a total of $210,000 over three years for Forest Safety Society programs.

"These initiatives cannot stem the ongoing conditions being faced by the industry. But forestry in Nova Scotia employs 16,000 Nova Scotians and has export values of nearly $800 million. The new program is a smart investment that acknowledges that economic contribution and recognizes that we must do what we can to help this vital industry remain sustainable during this difficult time," said Mr. Morse.


FOR BROADCAST USE:

     The province will invest millions of dollars in woodlot

silviculture and other forest-related initiatives as part of a

new program designed to help the forest industry weather what has

been called a "perfect storm" of negative influences.

     The increasing value of the Canadian dollar, high energy

prices, plummeting housing starts in the U.S., and changes in

global market conditions have exerted increasing pressure on the

industry, says Natural Resources Minister David Morse.

     Mr. Morse says the new program, which includes creation of a

task force of industry and government officials, cannot change

market conditions, but will help the industry transition through

difficult times.

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Media Contact: Diane LeBlanc
              Natural Resources
              902-424-2354
              E-mail: leblandj@gov.ns.ca