Editorial - Don’t count forestry out yet

Thunder Bay Ventures may have declared forestry “defunct” a little too soon but its annual small business survey does point to a new way of thinking – acceptance that a new economic model for the city is imminent and essential.
In its 12th annual survey, 63 per cent of respondents have pretty much given up hope on a revival of the once mighty forest industry as a means to again lead the city‘s economic recovery. The bleak picture of closed mills across the city and region with no substantial economic recovery in sight is further coloured by sagging demand for pulp, paper and lumber.
Even when the economy does bounce back, survey respondents don‘t hold out much hope that forestry will return to lead the local economy. “We need to move on from our current historic commodity production,” said Thunder Bay Ventures manager Royden Potvin.
Pessimistic? To a degree. Surely a resurgent North American economy will again need traditional products from Northwestern Ontario‘s forests. The question is how many mills that produce them will be around any more. The answer must lie in part in whatever plan is attached to Northern Development and Mines Minister Michael Gravelle‘s new forestry assignment. And what the companies plan to do to reinvent themselves.
As Potvin wearily noted, “We have no more sawmills ... most of the pulp mills are closed” and AbitibiBowater, the biggest and only mill still operating, is in bankruptcy. How the company emerges to capitalize on renewed demand – and when that demand ramps back up – will likely dictate the future of the important Thunder Bay operation.
The good news on that front comes from the Organization for Economic Co-operation and Development which has changed its prediction for U.S. economic recovery to a meagre but higher 0.9 per cent for next year. As goes the states, so goes its largest trading partner, Canada, where tentative increases on the Toronto Stock Market are swelling hope for the start of an economic recovery by the end of the year.
The Thunder Bay survey finding that 71 per cent believe 2009 will be a year of no or negative growth is countered by a sense of optimism, based on a dose of reality, among 63 per cent that the local economy can surpass the decline of forestry and “move on” to a modern, knowledge-based model.
The burgeoning health research business tied to Thunder Bay‘s regional hospital, its medical school, university and college, point that way. But a slimmed down forest industry will always be a part of the Thunder Bay economy. One that can meet renewed traditional product demands while developing new, value-added products will work best