Consolidation, Globalization and local development

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When I worked in the forest policy sector, I didn’t at the time realize I was a witness to historic changes in the sector, but in hindsight I realize now that I had a front row seat to some pretty big policy changes that took place as a result of globalization.

History tells us that Canadians have long been hewers of wood and drawers of water, first as a colony, and now as a global player in world trade. Even when Canada was a French colony, French mercantile policy and industrial interests insisted that the colony supply raw goods only. The people, as a result, were forced to purchase manufactured goods from French industrialists.

The policy prohibited the establishment of companies that would likely compete with those of the mother country. If we consider that we still export raw timber in the form of softwood lumber, and that our manufacturing sector has been eroded to the point where we barely can any of our own food, we can see not much has changed in 400 years.

Global pressures have been bearing down on us for centuries, and as a result what we see is a constant move to reach economies of scale through industrial consolidation.

At one time, our forests were similar to the organizational structures of small agricultural settlements. Mostly, the small towns would grow up around a mill. In the forests, the towns would grow near a lumber mill. In the agricultural sector, they would grow near grain mills.

There were a lot of small operations milling timber up until the 1970s in northern Ontario. In the 1990’s, forest policy changed to allow for larger forest management units, and centralization of milling occurred as wood was moved to larger mills. This resulted in the closure of the smaller mills and had huge impacts on small rural economies who lost their major employer.

Forest management units increased in size, sometimes tripling or quadrupling the area, in response to industry’s demands that they needed access to more wood in order to be competitive in a global market. As they say, it was a time of “go big, or go home.” At the time, the forest areas were known as Crown Forest Management Units, but provincial policy transferred management authority to industry through a licensing process, and the areas were then named after the forest company who held the permit.

We as a province have been through numerous policy changes in how we manage our “natural” resources, largely in response to global pressures to provide more raw materials to an increasing world population. We must take more and more resources, more quickly to supply world markets. That is the business model we are currently working with. In fact, the supply of raw timber increased so rapidly that mills had to be retrofitted in response, because the mills were originally designed to accommodate larger diameter older trees. The mills were re-jigged to accommodate smaller diameter trees because tree harvesting cycles started to get shorter.

Gee, I am starting to feel like the Lorax here.

The pressures on agricultural production are similar. For centuries, family farms were the foundation of our society and economy. But over decades, federal policies, subsidies, and changing technologies have shifted food production from small ecologically-sustainable family farms to giant agribusinesses.

We have seen an industrial consolidation in our food production and supply chains. When we talked of farming, mostly we were talking about small family farms producing local food, but today we are dealing with what people call agribusiness. This shift has meant we produce more food, more rapidly.

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