Value-added manufacturing in the forest industry is a growing contributor to economic and employment growth in Canada. Recent forest product innovations have led to improved industrial competitiveness and environmental performance in a wide range of industries, from natural resources, agriculture and manufacturing, to chemistry, cosmetics and healthcare. Given Canada’s abundant forest resources, strong environmental credentials, and effectiveness as an exporting country, many experts think the Canadian forest-sourced bioeconomy has not yet reached its full potential. Priorities for sustainable industrial development include:

1. Protecting Canada’s forests and primary resources: Value-added manufacturing in the forest industry depends on the sustainability of forest biomass resources and the strength of sectoral supply chains. Canada can protect its forestry resources by staying abreast of short- and long-term climate change impacts, including forest fires, pest infestation and variations in temperatures and biodiversity; by maintaining sustainable forest management practices; and by supporting innovation in forest operations, such as advanced harvesting technologies.
2. Advancing industrial integration, innovation and talent development: An integrated value-added supply chain is a foundational factor in the development of an advanced bioeconomy. Forest-sector innovation involves a wide range of interdependent processes, from primary resource management, harvesting and conversion (or refining), to value-added product research, development, testing, commercialization and market delivery. Given the highly specialized and capital-intensive nature of many forest-sourced industries, transformative innovation and technological upgrades depend on access to patient capital and the availability of a skilled workforce, especially in rural areas. The committee also heard that diversity and inclusion – namely of women, minorities and Indigenous peoples – are prerequisites for innovation.
3. Strengthening partnerships with Indigenous governments and communities: The bioeconomy represents an opportunity for Canadian governments and industry to strengthen their partnership with Indigenous communities, 70% of which are in, or adjacent to, forests. Indigenous peoples are concerned about the sustainability of both forest resources and employment opportunities; they want to be full participants in both traditional and new value-added forest operations and product manufacturing. Their participation in the forest sector can be enhanced through targeted and culturally-appropriate workforce development programs, and by investing in Indigenous-owned forestry businesses and value-added facilities. The committee also heard that bioenergy projects are of special interest to off-grid communities that rely on costly and high-emitting fuel imports for energy.
4. Maximizing market opportunities in Canada and abroad: The growing interest in renewable forest-based products and solutions is part of a global shift, driven by concern for environmental sustainability and resource security. Market development opportunities include, but are not limited to, bioenergy generation, advanced wood building construction, and biorefining to produce new products and alternatives to traditional petrochemicals and materials for multi-industrial applications. The committee heard that the federal and provincial governments should maintain an active role in the development and/or commercialization of Canadian value-added forestry products (and product applications) in both domestic and international markets.