State Of The Industry, Fall 2022 (Tree Planting in Western Canada)

“Conflicting Economic Data.”  That seems to be the current theme of Canada’s financial reality.  And the same phrase may perfectly describe the situation that western Canada’s planting industry currently finds itself in.  Bear with me for couple paragraphs of economic commentary, before I go more directly into the outlook for the 2023 planting season.  Economic analysis matters, because I believe that a major recession is coming our way like an oncoming freight train.

Around the globe, inflation is running rampant.  It doesn’t really matter how you define inflation, because all indicators are on the rise:  Food, fuel, other energy, consumer goods, services, etc.  Economists could argue for weeks about the current reasons for inflation, but the basic pressures are heavily rooted in energy supply shocks and a couple years of barely-restrained printing of money by various nations’ central banks (mostly to support global economies during Covid).  The current consumer price index inflation numbers are running at slightly over 7% annually in Canada.  As a result, the Bank of Canada has been pushing up the interbank lending rate, which causes banks to increase their prime rates and all other interest rates.

Higher interest rates generally cause people to pay down debt, rather than spending their earnings on fun things.  Therefore, the goal of higher interest rates is to cut down on consumer spending, which reduces demand for goods and services.  In turn, reduced demand normally puts downward pressure on prices for goods and services.  But higher interest rates also hurt a lot of people, because most of Canada’s population has mortgages, credit cards, and/or loans of various types.  We’re getting attacked from both sides, paying more at the pump, more at the grocery store, more for other goods and services, AND dealing with higher interest rates on top of that.  Sure, the higher interest rates will eventually stop prices from rising so quickly, but as I mentioned earlier, I believe that we’re in for a lot of short-term pain over the next 12-24 months.

In terms of wages, the economy is still quite strong, and there are more job opportunities than there are people to fill them.  The current unemployment rate in Canada is pretty low when compared with historical data.  When unemployment is low, employers need to compete harder to attract employees, so wages go up.  Although there are various ways of measuring this, it is likely safe to say that by year-end, wages in Canada will have increased by at least four percent compared to last year.  Unfortunately, a four percent increase in your wages doesn’t seem so great when everything that you buy costs ten percent more than it did a year ago.

The planting industry’s economic health varies from year to year according to many factors, but usually the most significant impact depends on the basic supply/demand of planting contracts, ie. how many trees the industry needs to plant each year.  When overall industry numbers go up (as they did a few years ago, after the 2017 and 2018 wildfire seasons in BC), tree prices go up at a company level.  And sometimes this trickles down to a corresponding increase in planter prices.  When industry volumes go down, companies bid aggressively to chase a diminishing amount of work, and prices go down.  We saw that happen these past twelve months.  The “boom & bust” periods are especially visible in public government work, which accounts for roughly 20% of the trees planted in BC each year.  However, work for private clients makes up the other 80% of industry volume.  Private client pricing (mills, logging operations) is more stable than public tenders, because a lot of that work is based upon multi-year agreements between mills and planting contractors who work together year after year.

Going into 2023, industry volumes are decreasing.  In 2022, we think that BC planted about 286 million trees.  The estimate for 2023 is roughly 262 million trees.  Planting contractors are therefore competing for a piece of a smaller pie.  Supply/demand economics dictate that public bid prices would normally decrease during the Viewing Season (for 2023 projects), which is just starting to ramp up.  But a drop in prices is the last thing that we need right now.

Company owners have numerous expense items to worry about.  Fuel has obviously jumped significantly in the past 12 months.  Buying a truck is more expensive.  Truck rental costs are rising significantly right now for 2023.  Prices for parts are higher, and maintenance/repair costs are way up.  For companies that have a Business Line of Credit or Payroll Credit Facility, interest rates are now double what they were six months ago.  Employer contributions on CPP and EI are also increasing, by 4.38% and 5.56% respectively (which of course is compounded if labour costs are increasing).

Food costs are much higher than a year ago.  The kitchen team from my camp did a comparison study of invoice prices from GFS for 2022 vs. 2021, using a basket of approximately thirty commonly purchased items, and the average price increase was 35.5%.  That’s stunning.  The only people that benefit from this are planters who work out of camp-based operations with kitchens, because they are shielded from these food cost increases (except when buying their own food in town on days off).  But these higher food costs are certainly hurting the companies that run camps.

There may be significant other challenges that companies have to navigate.  I’m a bit out-of-the-loop on this right now, but there were rumours of enhanced requirements for on-site dressing stations in 2023, and also for more ETV’s spread throughout the workforce.  Having more first aid gear available is unquestionably a benefit for workers.  But who is going to pay for this?  The workers?  If company owners don’t recognize and budget for these potential costs, and bid accordingly, that’s exactly what might happen.

Commercial regs for flight crew fatigue are changing for small operators in mid-December (large operators had to implement these same changes 24 months earlier).  Although the exact rules are quite complex, a general starting point is that the maximum length of a pilot’s "duty day" is being cut from 14 hours to roughly 12 hours per day (the exact length will vary based on certain criteria).  This means that if a pilot arrives at the hanger to start pre-flight planning at 5am, they have to be home with the machine parked and flight plans closed by 5pm, which of course means that they will have to leave the field worksite earlier than most of us are accustomed to.  The maximum hours of daily "flight hours" is also being cut, to 8 hours per day, although this won’t have significant impact since the machine isn't usually running that many hours in a day (except maybe up in High Level).  However, the minimum length for the "rest period" from night to morning is being raised from 10 hours to 12 hours.  It thus becomes essentially impossible for a pilot to fly trees out to stock up a block in the evening, then to return early the next morning to move crews. 

Going back to the length of duty day, the 12 hour day is a best-case scenario.  The exact regs are very complex, and depend on things such as the number of flights per day (that's the number of start/stop cycles of the machine's engine, not take-offs and landings).  The duty day length will also depend on the start time in the morning.  When a pilot starts especially early in the morning, their duty day becomes shorter.  So for example, a pilot doing seven or fewer flights in a single duty day, whose flight cycles are typically between 30 and 50 minutes duration, can only have 11 hours for duty day if they start at 5:59am or earlier.  Let's say that you need a pilot on site at 7am to start slinging trees before the planters arrive, but the ferry time from the airfield to Staging is 1hr.  The pilot will need to start their duty day with the pre-flight inspection and filing of flight plan no later than 5:30am in order to get in the air by 6am, and even that is optimistic because most rotary wing operators will budget a full hour from start time to being airborne.  Because the official start of the duty day is earlier than 6am, the pilot is now only allowed to have a duty day length of 11 hours.  So that could mean that the duty day runs from 5:30am to 4:30pm.  But since the pilot needs an hour of ferry time after planting to get back to the airport, AND time for post-flight and closing the flight plan, they really need to start flying home at 3pm.  Which means that planters might need to fly out of the block starting at 2:15pm.

One solution would be to run two pilots with each machine, to give planters a longer day, but helicopter companies would be reluctant to do this because it would double their labour costs.  Machine costs would also increase significantly if a helicopter needed to return to the airfield mid-day for a crew swap.  And on top of that, the industry doesn't have enough high-hour qualified pilots to make that scenario to work on a broad basis.

There are slight variations and allowances to these changes for certain situations, and a commercial pilot will have a better understanding.  Some details are available here, but again, the CARS regs are very complex.  The bottom line is that these changes will probably impact almost all planting operations that use helicopters extensively, so Project Managers need to contact their preferred helicopter providers and get a full understanding of these potential changes, before putting together any more heli budgets.  Helicopter use may become increasingly associated with constrained production.

There is also a good chance that minimum wage will jump significantly before next summer.  That’s great for workers in many underpaid industries.  It’s also good for tree planters, because companies that hire first-time workers must pay everyone at least the equivalent of minimum wage (including overtime) if their piece-rate earnings are not sufficient.  Will companies that hire large numbers of first-time planters have the foresight to plan for this possibility, and adjust bid prices upward?  A rising tide floats all boats.

Let’s go back to the lower industry volumes.  Can anything be done about this?  A few years ago, we thought that volumes would be historically strong for the next several years.  Part of that was based on the assumption of strong growth of federal tree planting projects, from programs such as the federal “2 Billion Trees” initiative.  But the 2BT program is struggling to scale up quickly, which isn’t a real surprise.  I’m quite familiar with the program, having acted as a project lead proponent for small projects both this year and last year, but my work (on the east coast) has been with very small numbers of seedlings.  For 2BT to work, big players need to design projects that will result in tens of millions of trees being planted, and there are a lot of challenges associated with designing such a project (especially in figuring out where to plant the trees).

In a perfect world, several of the dozen largest planting contractors would each purposefully plan to scale back operations in 2023 by retiring a camp.  I know of at least one major contractor that has already made a conscious decision to do exactly that.  If several companies planned to downsize this way, there would be less concern about the limited number of trees that are available for 2023.  But wait, why should we expect just the biggest companies to save the day?  If every company (regardless of size) downsized by just 8.3%, then the overall 2023 volume would be appropriate for the slightly smaller planting industry.  In such a scenario, supply-based downward pricing pressure would disappear, and bid prices would undoubtedly jump significantly.  Company owners AND their workforces would benefit.  Our industry is nimble enough to do this, but do company owners have the resolve?  Again, it’s the company owners that are hurting themselves if they don’t understand the need for every company to scale back slightly.

Planters expect wages to increase in 2023.  They know that wages are increasing in just about every other sector, and they know that workers are scarce.  What will happen if bid prices decline this fall, and owners have to tell planters after Christmas that planter prices are staying the same?  How many planters will seek employment elsewhere?  Will planting companies be able to hire enough people to get through 2023?  A lot of companies struggled to get their trees planted last year due to hiring challenges, and million of “spring” trees didn’t get planted until July.  Hiring will likely be even harder this year, considering the general labour market situation, so why risk chasing too many trees?  It’s better for companies to aim to scale back.

What else can planters (and companies) expect from 2023?  Well, from what I’ve seen so far, there are a few challenges to look forward to:

-        Head Protection:  WorkSafe has mandated the use of head protection on ALL understory planting in BC from now on.  While a hardhat may not protect you if an entire tree falls onto you, it could make a difference if you get hit by a dead branch.  Of course, hard hats bring their own separate problems, and planters hate wearing them.  Incidentally, we’re also seeing an increase in expectations for due diligence with more detailed DTA assessments.

-        Wildfire Planting:  There has been a LOT of wildfire restoration work in BC in the past four years.  Probably more than twenty companies have worked in the Elephant Hill fire alone since 2018.  Planting continues there, but so does grass encroachment.  As the grass spreads each year, the difficulty increases.

-        Plastic Ribbon:  The Cariboo-Chilcotin region (ranchland) banned the dropping of plastic flagger this past year, to protect cattle from eating plastic.  The full impact of this change was not felt in 2022, as a lot of multi-year contracts were still in progress.  But several multi-year contracts just ended, and the flagger ban throughout this region will be more ubiquitous in 2023.  Couple this with thicker grass in the burns, and we’re going to see a lot of double plants in 2023.  The industry MUST find a cost-effective supply of biodegradable ribbon soon, or loosen up spacing rules.  There are now a limited number of 500' rolls of corn starch ribbon available from Motion for $2.87 per roll, which is approximately three times the cost of polyethylene plastic flagger.  But if everyone bidding on no-flagger contracts were to add another 1.0 cents per tree to their bid price, that would be enough to purchase one roll of biodegradable flagger for roughly every one box of trees planted.  Bidders can pass the cost of this product on to clients!  We just need to make sure that every bidder factors that cost into their bid prices.  Easier said than done, of course.  Also, that price might eventually come down some, if the industry starts buying the corn starch product in large quantities.

-        Unwrapped Trees:  Again on the theme of saving plastic, more planters may see boxes being shipped this year without bundle wrappers.  It’s a great concept.  Single-use plastic is no good for anyone.  If western Canada plants 400 million trees per year including the prairies, that’s probably 30 million bundle wrappers per year that end up in landfills and occasionally scattered across blocks.  And aside from the plastic, if it takes 5 seconds to unwrap each bundle, that’s costing planters 2.5 million minutes each year.  I’m all for reducing plastic, and I’m quite familiar with planting trays of unwrapped trees on the east coast.  But when planters have to share boxes and each person has to do a count of their share of the box, unwrapped trees become a challenge.  We've also discovered that some nursery packing crews can’t count, resulting in boxes that don't have the correct number of seedlings in them.  When boxes are overfilled, it hurts the nursery, it hurts the planters, and it indirectly hurts the planting companies.  Nobody benefits except the Clients, who get free trees.  Nurseries that are moving in this direction need to implement working quality control systems BEFORE unwrapped trees become more widespread.  Perhaps it would help to tie the bundles with twine?  Or even better, wrap them in a band of light kraft paper or wax paper with a small piece of masking tape to seal the wrapper.  That would continue to protect the plugs better than a box of loose trees, which the forestry clients would prefer.  And it would allow for better monitoring of counts (both on the planter side and the nursery side), while still eliminating plastic wrappers.

-        Vehicle Safety:  I'll cautiously comment that vehicle safety seems to be improving slightly throughout the industry in the past few years.  Yes, I'm aware of some exceptions, and some accidents.  But we're generally seeing more common sense.  I have to give a shout out to ABBA here.  My crews meet a lot of other companies on the road, and this year, ABBA wins my award for the most professional radio use and cautious driving, at least when we worked in the same area back in April/May.  There seems to more of a safety-driven impetus from some Clients recently, a few of whom are asking for GPS trackers and/or dash cams (audio off) in their contractors' vehicles.  These devices probably make some people drive more cautiously, which is good.  A side note:  For anyone working in the Sparks wildfire area in 2023, be careful.  Some of those roads are going to be pretty sketchy when they're wet.

-        Access:  I’ll focus again on the regions where wildfire planting has been happening for the past few years.  It’s safe to say that in those regions, the low-hanging fruit has been plucked.  Each year, the blocks become more difficult to access.  Helicopter work is becoming more common.  And that brings up a good point.  What happens if someone gets hurt on a block where it’s impossible to extract a seriously injured patient without a helicopter?  Do companies have helicopters on standby for emergency situations such as this?  This is a good time to put in a plug for the services of the TEAAM helicopter recovery service for remote workers.

In terms of fire activity, as of October 17th there were still 202 active wildfires burning in BC.  That's crazy.  I've never seen so much active smoke during a Viewing Season.  Many of these fires will impact our industry in 2024 and beyond.

This year’s Viewing Season is really just getting under way in earnest in the past two weeks, and companies are on the edge of their seat about what will happen.  Will we see lower prices, due to decreased industry volumes?  Will we see higher prices, due to a recognition of how inflation is significantly affecting the cost of running a company?  We’re in the middle of an economic tug-of-war.  Now you see why I started off with the phrase, “Conflicting economic data.”  If company owners are smart, most of them will downsize slightly.  If that happens, bid prices will increase this year DESPITE the lower industry volumes, and companies will be able to react appropriately to general wage and inflation trends.

Considering what we had to deal with for the last three years, it seems crazy to say that 2023 may be the most challenging year that the industry has seen in decades.  But this time, the challenge will be economic rather than a global health pandemic.  Let’s hope, in the coming weeks, that company owners will bid appropriately …

 

Jonathan “Scooter” Clark 

www.replant.ca

 

Comment, December 15th - Many companies chased volume, and bid prices are down overall (sometimes significantly) from the levels of two years ago.  I'll put together a full report by the time the WFCA Conference happens at the end of January, and I'll link that here.

 

 

 

Links to Previous "State Of The Industry" Posts:

Fall 2021:  https://jonathan-scooter-clark.blogspot.com/2021/10/state-of-industry-fall-2021-bc-tree.html

Spring 2021:  https://jonathan-scooter-clark.blogspot.com/2021/04/state-of-industry-2021.html

Fall 2019:  https://jonathan-scooter-clark.blogspot.com/2019/09/state-of-industry-2019-bc-tree-planting.html

Fall 2018:  https://jonathan-scooter-clark.blogspot.com/2018/09/state-of-industry-british-columbia-tree.html

 

State of the Industry, Fall 2021 (BC Tree Planting)

Here we go again.  Viewing season has started in western Canada, with companies looking at contracts for 2022, and submitting bids.  What better time than now to comment on the state of the Canadian reforestation industry?

There are half a dozen main issues that I should comment upon:  Safety, inflation, industry volumes for 2022, tree prices, Covid, forest fires, and the 2021 Heat Wave.

 

Health & Safety

I could write an entire essay just about health & safety, but in the interests of keeping things short, I’ll summarize.  And I’ll address Covid separately.

Fatigue continues to be a problem for the industry.  This is especially apparent at the management level.  While a planter’s day is usually done at dinner, this is rarely the case for management at any level.  Company owners and upper-level managers need to continue trying to avoid letting camp and crew leaders work themselves to exhaustion.

Bear safety has been a regular tailgate topic for many years, but the issue really came into the spotlight at the end of July when a support staff working with a helicopter crew near Whitecourt was killed by a black bear who dragged her away from the staging area during planting operations.  Even though some types of accidents are incredibly rare (such as those relating to danger trees, wildlife attacks, and lightning), the risks cannot be ignored.

New OH&S reg are about to be released in British Columbia.  This may increase the number of OFA3’s that are required in the workplace.  However, this hasn’t been finalized.  If more OFA3's are required, this course will become an increasingly valuable addition to one's resume.

It appears that many companies are putting an increased emphasis on acknowledging mental health issues in the workplace.  Psychological first aid training courses are becoming more common, as is access to professional counselling.  I hope that such resources and initiatives continue to become more common.

 

Inflation

If you hadn’t paid attention, inflation is running hot these days.  You’re probably noticing this at the gas pumps if you’re a driver.  I was seeing prices of over $1.60 per liter in southern BC this week.  Imagine what prices will be next summer, considering that oil prices are expected to continue to rise.  Compare the price per liter with what fuel cost in the 2020 planting season, and you’ll see that fuel costs are going to have jumped by as much as 50% to 80% in a two-year period (admittedly, the prices in 2020 were a bit low due to Covid).  We certainly may see gasoline and diesel at $2/liter or more by the time next year’s planting season rolls around.  The global energy crisis is just starting to be felt in Canada.

Look at food costs.  The global food price indices are up around 30% year-over-year right now, based upon basic food commodity pricing.  But what does that translate to at the grocery store?  Well, various sources are suggesting that grocery prices in Canada are up by about 4-7% overall in 2021, compared to 2020.  And that upward trend is expected to continue.

Supply chain issues are also becoming more of a problem by the month, thanks to dozens of industries either underestimating or overestimating global consumption patterns when Covid was ramping up in 2020.  Right now, it’s almost impossible to buy new ATV’s, side-by-sides, or full-sized pickups.  I bought a new Jeep Wrangler (base model) in 2017 for $26k.  It now has forty thousand kilometers on it, and I could currently sell it for $35k.  One major truck rental agency recently sold all of it’s 2019 trucks.  Why?  Because after renting them in 2019, 2020, and 2021, they were able to sell them for fifteen percent more than they paid for them originally.  A lot of truck parts are also becoming very hard to find, including basics like air filters.  If a truck develops mechanical problems in 2022, it might be stuck at a repair shop for the remainder of the season.  Will planting companies have spare trucks to keep their fleets running?  Anything short of a 350 doesn’t have enough power to carry anything more than crew and a quad.  This is a flashback to the 90’s, but some planters may end up losing days of work due to vehicle downtime.  Vehicle costs (above and beyond fuel costs) are going to rise dramatically in 2022.

Real estate prices are up (not that many planters can afford to buy houses).  Tuition prices are up.  Retail prices are up.  If you’re an Amazon customer, go into your past orders and look at something that you bought 12-24 months ago, and check the current selling price.  Three-quarters of the things that I bought on Amazon in 2019 and 2020 have increased in price by 20-30%.

Wages need to rise to follow inflation.  Will planting companies bid higher this fall?  It’s hard to say.  Many companies that I’ve spoken to hope to factor 5% price increases into bids.  But will they have the resolve to do that?  I guess we’ll know in two months.

 

Industry Volumes for 2022

The Western Forestry Contractors’ Association recently held on online Market Summit.  I was flying at the time, and didn’t have the opportunity to watch the presentations in real time.  However, some of the presentations are online now.  Visit this page to find them:

   https://wfca.ca/2021/10/wfca-rumour-mill-roundupdate-volume-21-issue-12/

British Columbia is allegedly going to have a slight drop in overall planting numbers for 2022, with the total number of trees decreasing by about twenty million seedlings.  This isn’t entirely a bad thing.  It will let the industry catch its breath compared to two back-to-back record years in 2019 and 2020 (which were slightly more than 300 million trees each year).

A decrease of twenty million trees seems like a lot.  However, that’s only a decrease of about 7% from the levels of the past two years.  And considering that there were a number of significant contract extensions this year, and some non-completions, it’s obvious that the industry is still running very much near capacity.  On top of this, the numbers above don’t reflect additional planting that is coming on-stream from other non-traditional sources, such as oil&gas and environmental projects.

I don't want to appear to contradict the WFCA's analysis of future volumes, but they are obliged to rely on solid verifiable data, and that's a weakness.  Their analysis shows a slow decline in volumes for the next several years.  This is understandable, considering the data that they have to work with.  However, I think they're currently forced to neglect two major factors in their analysis:  2021 Wildfires, and the 2021 Heat Wave.  More on these subjects below.

I expect the industry drop in volume for 2022 to be temporary.  Demand will be pushing the limits again in 2023.

Tree Prices

What can planters expect for tree prices in 2022?  Well, in theory, we’d like to see slight increases, to counter the effects of general price inflation.  Unfortunately though, I think we’ll see that pricing will remain stagnant.  I’d like to think otherwise, but I’m being realistic here.

Most of the industry participants (planting company owners and upper management) understand the need to increase bid prices due to inflation.  Most participants know that Covid costs are not included in this year’s numbers, and unlike last year, needed to be added on top of bid prices.  Most participants are involved in broad discussions (such as the recent WFCA Market Summit), and know that they as a group are responsible for the fiscal health of the entire planting industry.

In 2021, the average bid price on all of the “easy” northern Interior government contracts last year was 48.73 cents per tree.  But there was also an automatic 8.6% added onto these [camp-based] contracts for Covid costs, so the true bid price was around 52.92 cents per tree.  If 5% inflation (and a component for Covid) is added this year, then one would hope that the winning bids for northern Interior work average out to around 55.4 cents.  If bids are lower than this, the bottom line at the planting companies will be what suffers the most.  The ball is in the contractors' court here.  If a company tries to low-ball a few bids then drop planter prices to maintain profitability, they will lose planters to competitors.  The labour market is very tight these days.

 

Covid

I can say with complete certainty that we’re all getting pretty sick of hearing about Covid by now.  And yet, people are still dying, so we can’t ignore it.  In the coming months, company owners will have to make tough decisions about operating parameters for 2022.  For the past two seasons, the camp-based companies made the decision to keep planters in camp on days off, but also to provide meals and laundry services on those days.  Will companies continue to absorb those costs if bid prices don’t support the cost?  Or will planters be free to go to town again?  And if that’s the case, how many cases of Covid will come back to the camps with them?  At least three major companies started to let their planters travel into the local communities in July of this year, and subsequently had to deal with Covid cases among their crews (this was in addition to the two other companies that had Covid outbreaks in the spring).  We want our freedom, but we also want safety.  Where is the balance?

Vaccinations will also be a hot topic in the coming months.  Company owners have also been discussing this issue.  My belief is that a lot of companies will require all employees to be double-vaccinated in 2022 as a condition of employment.  The vast majority of planters are already vaccinated anyway, so this mandate wouldn’t bother most people in that subset of the workforce.  Many planters have said that they’d prefer for their workforces to be 100% vaccinated, because that will presumably grant greater freedoms.

Planters who are not and do not wish to be vaccinated will be vocal in their frustration about these policies.  Some planting companies may specifically decide against vaccination policies, in hopes of capturing a larger group of [non-vaccinated] experienced planters who are looking for new homes.  It will be interesting to see what happens.  Considering that the majority of current cases are among unvaccinated people, will any vaccinated planter want to work at a company that doesn’t require vaccinations?  In theory, the risk of Covid outbreaks will be significantly higher at those companies.

 

Forest Fires

The wildfire season is essentially over.  After two record-breaking fire years in 2017 and 2018, British Columbia saw two very quiet years in 2019 and 2020.  But 2021 was another bad year.  By September 30^th, approximately 868,000 hectares had burned throughout the province, which is more than twenty times the wildfire land base of the previous two years put together (2019 and 2020 combined only saw 36,000 Ha burned).

The past few years have seen improvements for tree planters in comparison to historical earnings from the previous decade.  This was solely due to the 2017/2018 wildfire activity.  There was strong demand for planters, as the forest industry and the province tried to fix some of the damage from the massive wildfires of those two years.  That work will continue in 2022 and beyond.

Many people assume that planting of areas burned by wildfires can happen within days or weeks.  That’s not the case.  Post-fire reforestation is very complicated, with complex timelines.  For the next several months, foresters are going to be assessing the damage in their regions.  Long-term planning starts to happen.  Budget decisions need to happen, to figure out where to find money to restore burned forests.  A lot of that funding originates from government, which typically doesn’t move as fast as industry.  However, there is one other significant delay – procurement of seedlings.  Canada’s nurseries are operating near capacity.  Even when nurseries have space to grow trees, seed must be allocated, and then the seedlings need to be grown.  All of this takes a lot of time.  Although a bit of 2021’s burned ground will undoubtedly be planted in 2022, most of the planting really won’t start in earnest until the spring of 2023.  I expect to see record-breaking volumes in 2023, if the nurseries can supply enough seedlings.

 

Heat Wave

This is a story that hasn't been discussed widely as of late, perhaps because it's such a sad story.  The heat wave appears to have caused widespread seedling mortality.  Actually, "widespread mortality" is a strong understatement.  The western Canadian heat wave in late June and early July killed an incredible number of seedlings throughout BC and Alberta.  I've visited several plantations this week where not a single [2021] seedling survived, not even the trees hidden in the shade.  There was nothing wrong with the stock or with the planting quality.  The heat (and several weeks without appreciable moisture in the soil) just toasted them.  I'll post a photo at the bottom of this essay to show an example of a fir seedling that was perfectly planted behind a large obstacle (northeast side), and perfectly protected from the hot southwest afternoon sun.  However, it didn't survive.  Nor did any of the hundreds of thousands of other trees (multiple species) on the same block.

I'm hearing similar reports from several parts of BC and even into northern Alberta.  I've never seen anything like this.  It's incredibly disheartening.  I don't think the industry has ever experienced anything like this.  I hope I'm overestimating, but it may be that more than 25% of the trees planted this year have experienced cataclysmic failure.  With over 400 million seedlings planted in Western Canada this year, more than a hundred million may have died in the heat wave.  It's going to take years for some regions to recover from this.  And again, depending on funding, this is one more reason why the industry will need to run at full speed in 2023 and beyond.

 

Conclusions

After two record-setting years, it probably wouldn’t be such a bad thing to have a “normal” busy year.  Fatigue continues to be an issue for the industry (especially on the management side), and a lot of owners and camp supervisors would be happy to have a less challenging season in 2022.  Despite this, the number of trees to be planted is still very high by historical standards.  Let’s hope that everyone gets a lot of rest this winter.

I'll update this post in February 2022, to reflect upon the results of the fall 2021 bidding season.

- Scooter

www.replant-environmental.ca

Links to Previous "State Of The Industry" Posts:

Spring 2021:  https://jonathan-scooter-clark.blogspot.com/2021/04/state-of-industry-2021.html

Fall 2019:  https://jonathan-scooter-clark.blogspot.com/2019/09/state-of-industry-2019-bc-tree-planting.html

Fall 2018:  https://jonathan-scooter-clark.blogspot.com/2018/09/state-of-industry-british-columbia-tree.html

 

 

 

 

 

 

 

 

 

State of the Industry, Spring 2021

As I write this, my camp is preparing to mobilize in just 24 hours for the start our tree planting season.  I’ve been working on this post sporadically for a few months, but until now I didn’t feel that it was the “right time” to publish an annual commentary.  I was hoping that Covid would be on the decline by the time Interior operations got started, and that I’d be able to provide a postmortem.  Instead, the next few months will be more challenging than 2020.

Review of the 2020 Season

Let’s look back at the 2020 season for a few minutes.  In retrospect, we’re in an advantageous situation right now.  Compared to 2020, we’re almost properly prepared to commence field operations.  On this date twelve months ago, we didn’t even know if there would be a tree planting season.  It wasn’t until Sunday night, April 19^th (2020) that I sensed we’d be allowed to mobilize, and I rapidly sent out an email to my crews to tell them that it was worth gambling on booking their flights.  Fast forward to today, and our planning looks very different.  We have plans in place to deal with many different Covid-related contingencies, whereas last year we were flying by the seat of our pants.

We were lucky in 2020.  Not a single camp had a known case of Covid.  And that’s what matters the most, because at the end of the season, it’s not a healthy bank account that matters – it’s the health of the employees.  Can we do the same this year?

Another notable thing about 2020 was that prices continued to trend slightly upward, extending the recovery that started the previous year.  While there’s always more room for upward growth, it seemed that more workers considered their wages to be fair, and when they returned home at the end of the season, they were more likely to tell friends that the job “wasn’t so bad.”

By the fall, owners were feeling very relieved.  Many of them had been staring at the prospect of potential bankruptcy, but the lack of Covid in the camps meant that all the planting companies survived, and will continue operating in 2021.

As viewing season rolled around, the only notable excitement was a very strange policy shift by the provincial government, which saw some MOFLNROD and BCTS offices hiding submitted bid numbers on their public tenders.  It is regrettable that, absent a Freedom of Information Act request, agencies playing with the public purse feel that they should not be held accountable for sharing information about major costs. This of course wasn’t the case at every office.

In the end, it didn’t matter.  Although collusion before a bid is opened would be illegal, there are no restrictions about talking about bids that have already opened.  Almost all of the planting contractors in the industry got together and shared their numbers (behind the scenes) after each bid was opened, and we had a very good ongoing picture of where the bids were trending.  In the end, I believe that this policy of non-disclosure probably worked against the government agencies, rather than in their favour.

By the way, the industry planted it's nine billionth tree in British Columbia in 2020!  That means that there will be a big milestone coming up in 2023.

Covid

Everyone is pretty sick of hearing about Covid, so I won’t dwell on it.  However, it’s the obvious elephant in the room, so I can’t skip over it.

The government has been a leader in ensuring that incremental Covid-related costs do not force a significant portion of the sector into bankruptcy.  Licensees have followed, albeit some with reluctance (despite the forest industry’s record-high lumber prices).  Known costs (extra staffing and supplies) have been addressed on a cost-sharing basis between industry and clients, with some help from various levels of government.

However, one very significant issue remains, and that relates to the expectation of significant incremental costs when Covid gets into camps.  Notice that I said “when,” not “if.”  The industry has approximately 80 mobile tent camps, most of whom house anywhere from thirty to a hundred planters or more.  Based upon the prevalence of Covid within the general population, the odds that an infected worker comes into camp are approximately thirty times higher now than they were in 2020.  I’ve already heard of numerous planters who have tested positive in the past two weeks, and it is obvious that a number of planting camps are going to experience case clusters this season.  With the recent PHO orders indicating that a PHO shutdown is possible for any cluster of three or more cases, this means that some camps will almost certainly be shut down for 14-day circuit breakers this season, which means that project completion dates will have to be pushed back.

Nobody is talking about it right now, but I feel that the season will necessarily need to be extended this year, as companies attempt to help each other catch up on missed deadlines.  Of course, this will be entirely dependent on exactly how the PHO approaches their shutdown protocols.  It will be a tricky situation, because a camp that has a cluster of cases can’t just drive into the local community and book motel rooms for two weeks.  They’ll have to remain sequestered in the bush, and it will be necessary for employers to continue feeding and taking care of workers.

Testing has been brought up repeatedly as one part of a mitigation strategy.  It would be great if the industry had widespread access to rapid-result tests that could be administered to the entire workforce every three days for the first three weeks of the season.  However, resources don’t currently exist to support that strategy.

Vaccinations are also on everyone’s wish lists.  Although they wouldn’t be mandatory, enough planters would seek to be vaccinated that the camps would essentially reach herd immunity.  However, considering the length of the season, and the time that it takes for administered vaccines to build immunity within individuals, that strategy would lose most of its impact unless it could be pulled off in the first half of May.  Even then, it takes time for the vaccination to kick in, and workers are not “fully” immunized until after a second dose.  Regardless, vaccinations would still be very beneficial to most individuals, as evidence seems to indicate that even after a first dose, persons who still manage to contract Covid generally don’t get as sick.

The PHO has an evolving vaccination strategy that is currently targeting some hot spots in specific communities and industrial work sites.  But will that extend to BC’s forty-five hundred tree planters, or will they be forgotten in the woods?  I’m sure that a few other provinces are grappling with the same problem, although it seems that BC is the only province that recognizes its tree planters as a culturally unique and economically significant workforce.  Also, many planters are from out-of-province, and remain concerned about vaccine eligibility while working for British Columbia. 

 

Safety

We’ve seen big improvements over the past six months in the ways that many companies are addressing the prevention of bullying and harassment.  This is a major shift that got a foothold after the January 2020 WFCA Conference, but which was partially derailed by Covid a few months later.  However, I’m now seeing a much better understanding throughout the industry of the need to address the prevalence of harassment.  And certainly, the industry’s tolerance for inappropriate behaviour is much lower now than it has been in the past.  Many companies have also realized that while gender parity is very close to being achieved at a planter level, there is still a woeful inadequacy of women in upper management and at the ownership level.  That can’t be changed overnight, but we need to challenge ourselves to change that weakness in the next three years.

Mental Health is being recognized more than ever before.  Covid helped to kick-start that revolution, as companies became acutely aware of the challenges that planters had to deal with in isolation camps.  Again, that’s an area which is seeing improvement.  A number of the larger companies have been offering psychological first aid courses to all levels of management, and there is current talk about industry-wide support programs such as one potential program that Tim Tchaida and other WFCA members are examining.

Finally, back to Covid, our society has a better familiarity with constant use of masks.  While that won’t make 2021 any more enjoyable than 2020, it won’t feel so unfamiliar to be wearing masks constantly in camps and trucks.  And while there are always some planters that disagree with mask rules, and resist the concept of testing and vaccinations, the majority of the workforce recognizes that we need to work together for our own individual good.  If planters are careless coming into the season, it’s not just their own health that is at risk.  The bigger risk is a shutdown of their crew or camp.  As with masks, you don’t follow the rules to protect yourself; you follow them to protect everyone around you.

I’ve talked to more than a dozen other supervisors over the past few weeks.  We all recognize that the inevitable outbreaks in our camps will mean that this season will be a lot more challenging than in 2020, we understand the challenges.

Let’s get to work …

 

Previous SOTI posts:

September 2018

September 2019