The primary objectives of this study are to demonstrate the feasibility of:
1. Producing high quality value-added products from lesser-used species through prototyping; and
2. Marketing high quality value-added products from lesser-used species through consumer research on the prototypes at home shows.
In year one of the project, fibre was sourced and prototype products designed and produced. This was achieved through partnering with eleven companies from the primary and value-added wood industries in British Columbia and Saskatchewan. Having carried out these prototyping exercises, there are two main areas to assess after the first year of the project. These are: (1) the appropriateness of the underutilized fibre for use in furniture and interior finish products, and (2) the infrastructure that exists to take the fibre in log form through to market-ready interior finish or furniture products.
All six species used in this study were well received by the companies that utilized them in the production of prototypes. All species machined well and were deemed to have appropriate properties for the products for which they were used . In situations where a partner company had never used a certain species, all companies indicated a willingness to use the species in the future, given adequate supply and market demand.
Most of the challenges encountered in year one of this project were with respect to gaps in the infrastructure in place. Infrastructure varies among provinces, species, products, and all combinations thereof. However, some general observations can be made that cover most industry scenarios.
For interior finish and furniture manufacturers, there seem to exist two extremes with respect to the use of underutilized domestic species:
1. Many furniture and interior finish producers in Western Canada are completely detached from the domestic resource. This is due to the lack of availability of suitable domestic lumber and veneers for their manufacturing needs. In addition, risk aversion with respect to market demand prevents some from using new species.
2. Other manufactures of interior finish have taken the approach of integrating back to the resource by sourcing logs, sawing lumber, and drying lumber, all in addition to their core business of designing, manufacturing, and marketing finished products. Many of these companies report difficulties sourcing logs. In addition, the vertically integrated business model of sourcing logs to marketing consumer products is challenging for smaller companies to excel at.
To foster growth in the use of domestic underutilized species in the value-added sector the following infrastructure challenges must be addressed with respect to fibre conversion.
Access to logs is reportedly difficult for smaller producers who specialize in sawing for the value-added sector.
The specialty sawmilling industry that focuses on the recovery of visual grades, grain orientation, and colour sorts has not fully developed in Western Canada.
Drying capacity appropriate for lumber destined to the value-added industry is limited to non-existent in some regions.
Veneers are not available in many underutilized species, stalling the potential growth in lumber demand as the two products are used together.
Prospective demand for specialty lumber and veneers from underutilized species must be clearly documented to warrant investment by specialty sawmills.
Key recommendations and industry needs identified after the first year of this study include:
1. Technical transfer to specialty sawmills -
These companies need the background, technical information, and tools to produce lumber of underutilized species for value-added markets. Specialty mills must be introduced to the possible grades and sorts that can be produced for this type of lumber, as well the type of sawing optimization that will allow them to recover these grades.
2. Drying facilities –
Drying capacity is necessary for lumber manufacturers who wish to be in the value-added market. However, many of these mills are very small and cannot justify the expense of their own kilns. The model of centralized drying operations partnering with multiple small sawmills must be further explored and developed.
3. Marketing and distribution –
One of the requirements of the value-added industry is consistent supply. Again, a collection of small sawmills would be better positioned to provide continuous supply than single sawmills. Further, the value-added industry must effectively market their products of underutilized species if they are to provide sufficient demand for specialty sawmills.
4. Veneer availability –
Veneers are necessary to establish a new species in the value-added sector as they are used with lumber. Veneer production can be outsourced, as veneers are economical to ship. However, companies wishing to sell a new species of lumber must ensure veneers are an option for their potential customers.
5. Market research –
The last component needed is market research indicating to specialty sawmills and value-added producers that there is sufficient market potential for lumber and finished products made of underutilized domestic species. This will be addressed in year two of this project.
In year two of this study, the prototypes that have been produced will be the subject of market research on the consumer acceptance of products made underutilized domestic species. Data will be collected at six home shows; two in Canada and four in the United States. Combinations of species, grades, and product formats that have the best market prospects will be identified.