Federal Funding Delay Leaves Mills Vulnerable

The federal government announced a historic 6.5 billion funding package to modernize the forestry sector in Canada. While industry leaders welcome the investment, the money will not reach struggling mills until the 2027 to 2028 fiscal year. This delay leaves workers and communities across New Brunswick and the rest of the country vulnerable to immediate market pressures.

According to a report from The Canadian Press, the six year spending plan aims to help companies upgrade aging facilities, boost productivity and develop new products. However, the forestry sector faces immediate threats from United States tariffs, weak markets and rising operational costs.

Local Impact in New Brunswick

You can see the local impact right here in New Brunswick. AV Group NB Inc recently idled its pulp mill in Nackawic temporarily. This decision affects about 350 workers. Similar closures are happening nationwide. Rayonier Advanced Materials halted production at its Temiscaming facility in Quebec, impacting over 300 unionized jobs. Domtar also indefinitely idled operations in Port Mellon, British Columbia, affecting 400 employees.

Industry Leaders Speak Out

Derek Nighbor serves as president and chief executive of the Forest Products Association of Canada. He calls the 6.5 billion commitment precedent setting. He warns that 2027 will remain a difficult year for the industry because housing starts remain weak and United States tariffs persist.

Ken Farr, president of the Canadian Institute of Forestry, worries the funding arrives too late for some operations. “The issue is now and the problem is now,” Farr says. He notes the industry faces severe challenges from tariffs, aging facilities and limited access to affordable timber supplies. “I don’t think any kind of funding can be sent too soon,” Farr adds. “It will help companies upgrade their equipment, raise productivity and transition to higher value wood and paper products.”

Frequently Asked Questions

When will the federal forestry funding become available?

The federal government plans to start distributing the 6.5 billion funding package during the 2027 to 2028 fiscal year.

How does this affect New Brunswick forestry workers?

The delay in funding leaves local mills vulnerable to current market pressures. AV Group NB Inc recently idled its Nackawic pulp mill, affecting 350 workers.

What are the main challenges facing the forestry sector right now?

The industry currently faces a combination of United States tariffs, weak housing markets, aging facilities and limited access to affordable timber.