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How does the forest products industry benefit Canada’s economy?

The forest products sector is a key contributor to the Canadian economy. In fact, the sector creates more jobs and contributes more to the balance of trade – for every dollar of value added – than do the minerals and metals sector or the energy sector.

In 2015 alone, the forest products sector balance of trade stood at $21.5 billion, compared to a negative balance for the economy as a whole.

While exports to Asian markets have increased, the U.S. market continues to be the primary destination for Canadian forest products. Non-traditional forest products have also become more important to the sector and to Canada’s economy. Expanding product markets include bio-fuels that can substitute for fossil fuels and bio-chemicals that can be used to produce biodegradable plastics and industrial chemicals.

Benefits to Canada’s economy, 2015

Although it contributes less to total GDP than other resource sectors do, the Canadian forest products industry accounted for almost 7% of all Canadian exports in 2015. The following table outlines the benefits to Canada’s economy in 2015 for the forest, minerals and metals, and energy sectors; their contribution to GDP, their exports per dollar of value added, their balance of trade per dollar of value added, and the number of jobs per million dollars of value added.

Sector Contribution to GDP (billions of dollars) Exports per dollar of value added Balance of trade per dollar of value added Number of jobs per million dollars of value added
Forests            $22.1          $1.50          $1.00                  9.1
Minerals and metals            $60.2          $1.50          $0.20                  6.2
Energy            $131.9          $0.70          $0.40                  2.0

To learn more about the contributions of Canada’s forest products industry, check out the 26th edition of The State of Canada’s Forests: Annual Report 2016. This annual snapshot from Natural Resources Canada explores the themes of sustainable forest management practices and climate change strategies and solutions.

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