How does the forest sector contribute to Canada’s economy?
The forest sector is an important contributor to Canada’s economy, serving as a key source of prosperity for people and communities across the country. The Canadian forest sector has traditionally manufactured products such as lumber, panels, wood pulp, newsprint and other printing and writing papers. However, new non-traditional products are added to the forest sector’s repertoire each year to meet the needs and demands of our ever-changing world. The forest sector serves as an important source of economic opportunity for people and communities, employing Canadians from every province and territory except Nunavut. The economic contributions from the sector are particularly important in many rural, remote and Indigenous communities, where forest-related work is often the main source of income.
Key sustainability indicators
Explore the report to find information on the key sustainability indicators:
- Forest sector gross domestic product: Annual reporting of the Canadian forest sector’s GDP. Contributions to nominal GDP is one of the primary indicators used to evaluate the size and health of Canada’s forest sector.
- Production of forest products: Total yearly production of Canadian forest products. This indicator is important because Canada is one of the top global manufacturers of forest products, and production is one of the first indicators influenced by economic and market challenges.
- Exports of forest products: Total value of annual exports of Canadian forest products. This indicator provides information related to how the Canadian forest sector meets the needs of global consumers, including helping them achieve their climate mitigation goals, while making a substantial contribution to Canada’s economy and balance of trade.
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Forest sector gross domestic product
Key information
Gross domestic product (GDP) represents the total value of all final goods and services that are produced each year. It is a measure of the size of a country’s economy.
In 2021, the World Bank ranked Canada as the ninth-largest economy in the world.
In 2022, the forest sector contributed $33.4 billion (1.2%) to Canada’s nominal GDP, which represents a growth of 7% compared to 2021. However, real GDP was flat year-over-year.
Canada’s total economy grew by 17% in nominal terms during 2022 and by 3.6% in real terms.
- Prices for wood products were elevated for much of 2022, while pulp prices reached record highs, helping explain the difference between the forest sector’s nominal and real GDP.
- In the wood product manufacturing subsector, real GDP rose 6% thanks to the continued high demand in the home building, repair and remodeling markets.
- Real GDP in the pulp and paper manufacturing subsector decreased 3% year-over-year. Reduced demand for packaging and the ongoing decline in newsprint was partially offset by a recovery in printing and writing papers.
- Real GDP in the forestry and logging subsector fell 10% in 2022, driven by ongoing wood supply constraints in British Columbia.
Why is this indicator important?
- Contribution to nominal GDP is one of the primary indicators used to gauge the size and health of Canada’s forest sector compared with Canada’s other economic sectors.
- The change in real GDP shows the growth of the forest sector after accounting for inflation. Analysts use this indicator to compare the Canadian forest sector’s output to that of the national economy.
Canadian forest sector’s gross domestic product, 2012–2022
Graph summaries
Graph 1: Comparison of the forest sector nominal gross domestic product by subsector for each year between 2012 and 2022.
Graph 2: Comparison of the proportion of real gross domestic product growth for all sectors and for the forest sector between 2012 and 2022.
Graph data
Canadian forest sector’s gross domestic product, 2012–2022
Graph 1:
| Year | Nominal GDP (billion dollars) | ||
|---|---|---|---|
| Forestry and logging | Wood product manufacturing | Pulp and paper manufacturing | |
| 2012 | 3.94 | 7.40 | 7.47 |
| 2013 | 3.39 | 8.79 | 7.42 |
| 2014 | 3.73 | 8.72 | 7.93 |
| 2015 | 3.99 | 8.96 | 8.58 |
| 2016 | 4.09 | 9.99 | 8.61 |
| 2017 | 4.52 | 11.12 | 8.84 |
| 2018 | 4.82 | 11.86 | 10.47 |
| 2019 | 4.28 | 9.34 | 9.22 |
| 2020 | 4.05 | 10.75 | 8.92 |
| 2021 | 5.30 | 16.54 | 9.44 |
| 2022 | 5.90 | 17.04 | 10.43 |
Graph 2:
| Year | Real GDP growth (% annual) | |
|---|---|---|
| Total all sectors | Total forest sector | |
| 2012 | 1.8 % | -1.4 % |
| 2013 | 2.6 % | 1.7 % |
| 2014 | 2.8 % | 4.0 % |
| 2015 | 0.9 % | 3.2 % |
| 2016 | 1.1 % | 0.2 % |
| 2017 | 3.4 % | -2.0 % |
| 2018 | 3.0 % | -0.3 % |
| 2019 | 2.0 % | -5.1 % |
| 2020 | -5.0 % | -1.2 % |
| 2021 | 5.0 % | 5.6 % |
| 2022 | 3.6 % | 0.0 % |
Production of forest products
Key information
Canada is the world’s largest producer of newsprint, the largest producer of northern bleached softwood kraft pulp, and the second-largest producer of softwood lumber.
Between 2021 and 2022, Canadian production of most forest products decreased. Softwood lumber production decreased by 9.5% and production of structural panels decreased by 0.7%. In the pulp and paper sector, printing and writing paper production increased by 6.8% in 2022, while wood pulp and newsprint production decreased by 4.7% and 2.6%, respectively.
- Demand for solid wood products softened in 2022 due to higher mortgage rates and persistent inflation, which reduced affordability and slowed residential construction activity in both Canada and the United States. This prompted mills to curtail production, particularly in British Columbia where fibre availability is an ongoing challenge.
- Despite strong global pulp demand and record high pulp prices in 2022, wood pulp production in Canada was affected by global supply chain challenges, as well as transportation disruptions and fibre shortages in British Columbia.
- Printing and writing paper production continued to recover from a significant decline in 2020, partially due to an uptick in demand from commercial print advertising.
Why is this indicator important?
- Canada is one of the top manufacturers of forest products in the world.
- Production is one of the first indicators to be affected by economic and market challenges.
Production of Canadian forest products, 2012–2022
Graph summary
Comparison between the production of five wood products for each year between 2012 and 2022 (split between two graphs).
Graph data
Production of Canadian forest products, 2012–2022
Graph 1:
| Year | Production (million tonnes) | ||
|---|---|---|---|
| Newsprint | Printing and writing paper | Wood pulp | |
| 2012 | 3.87 | 3.31 | 17.15 |
| 2013 | 3.97 | 3.47 | 17.25 |
| 2014 | 4.01 | 3.26 | 16.96 |
| 2015 | 3.51 | 3.04 | 16.55 |
| 2016 | 3.34 | 3.00 | 16.51 |
| 2017 | 3.05 | 2.98 | 16.30 |
| 2018 | 3.00 | 3.05 | 16.18 |
| 2019 | 2.68 | 2.61 | 15.42 |
| 2020 | 1.96 | 2.27 | 14.30 |
| 2021 | 1.89 | 2.43 | 14.26 |
| 2022 | 1.84 | 2.60 | 13.58 |
Graph 2:
| Year | Production (million cubic metres) | |
|---|---|---|
| Softwood lumber | Structural wood panels | |
| 2012 | 54.54 | 6.70 |
| 2013 | 57.51 | 7.13 |
| 2014 | 57.78 | 7.69 |
| 2015 | 62.72 | 7.97 |
| 2016 | 65.03 | 8.73 |
| 2017 | 65.13 | 8.92 |
| 2018 | 64.38 | 9.17 |
| 2019 | 56.66 | 8.45 |
| 2020 | 54.72 | 8.30 |
| 2021 | 55.84 | 8.94 |
| 2022 | 50.55 | 8.87 |
Exports of forest products
Key information
Canada is the world’s leading exporter of softwood lumber, exporting $13.7 billion in 2022.
By value, Canada is the fourth-largest forest products exporter in the world, behind China, Germany and the United States.
In 2022, Canada’s total forest products exports increased 1.4% to $45.6 billion, as compared to 2021, with most exports bound for the United States. However, year-over-year changes in exports varied widely across product types.
- In 2022, softwood lumber exports decreased the most ($2.8 billion; down 17% compared to 2021) and the value of structural wood panel exports also dropped 14% year-over-year. Softening demand due to rising interest rates and declining prices for lumber and panels over the second half of the year led to the decrease in export values.
- Export values in 2022 for newsprint, as well as printing and writing paper bounced back after years of long-term decline, up 35% and 33%, respectively, from 2021 levels. Wood pulp and other forest products also rose 16% and 15% from 2021 levels. Fibre shortages, high production costs and shifts towards higher-valued paper and packaging all supported higher export values in these product categories.
Why is this indicator important?
- As one of the world’s largest forest product exporters, Canada is a key supplier to markets around the world. Canada has an abundant and renewable supply of wood that is sustainably managed. By exporting forest products, the Canadian forest sector meets the needs of consumers around the world, helping achieve climate change mitigation goals while making a substantial contribution to Canada’s economy and balance of trade.
Exports of Canadian forest products, 2012–2022
Graph summary
Comparison of the export value among various Canadian forest products, for each year between 2012 and 2022.
Graph data
Exports of Canadian forest products, 2012–2022
| Year | Exports (billion dollars) | |||||
|---|---|---|---|---|---|---|
| Softwood lumber | Newsprint | Printing and writing paper | Structural wood panels | Wood pulp | Other forest products | |
| 2012 | 5.7 | 2.3 | 2.4 | 1.1 | 6.8 | 6.9 |
| 2013 | 7.4 | 2.4 | 2.5 | 1.5 | 7.0 | 7.7 |
| 2014 | 8.3 | 2.6 | 2.5 | 1.4 | 7.5 | 8.6 |
| 2015 | 8.5 | 2.3 | 2.6 | 1.6 | 8.0 | 9.8 |
| 2016 | 10.0 | 2.2 | 2.2 | 2.2 | 7.6 | 10.3 |
| 2017 | 10.4 | 2.0 | 2.1 | 2.5 | 8.3 | 10.7 |
| 2018 | 10.2 | 2.3 | 2.4 | 2.7 | 9.7 | 11.1 |
| 2019 | 8.0 | 1.9 | 2.4 | 2.0 | 8.0 | 10.9 |
| 2020 | 10.0 | 1.3 | 2.0 | 2.9 | 6.7 | 10.4 |
| 2021 | 16.4 | 1.4 | 2.0 | 5.5 | 7.7 | 12.0 |
| 2022 | 13.7 | 1.8 | 2.6 | 4.7 | 8.9 | 13.8 |
Sources and information
See Sources and information in the downloadable report for detailed sources.
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