Budget 2026 includes $6.5B for forest sector, hard hit in B.C.

VICTORIA — The federal budget includes several measures that promise to support the forest industry in British Columbia as it weathers U.S. tariffs, but it’s not clear how much will flow to the province.

The federal government says Canada’s forestry sector, which faces combined tariffs and duties of around 35 per cent, will receive $6.5 billion over six years, starting 2027-28, to improve productivity and competitiveness.

There’s $4 billion for a new “forestry sector accelerator” to invest in large facilities and transform existing ones into biorefineries, biofuel facilities and other projects, while the sector will receive another $2 billion to modernize facilities and equipment.

A further $500 million will go toward improving the fibre supply through better forest management, stewardship and the deployment of technology.

Kim Haakstad, president and chief executive officer of the BC Council of Forest Industries, says it is not clear how much of the money will flow to the sector in B.C., which has been struggling over the last few years.

Haakstad says in an interview that the industry’s work with both the provincial and federal government has been about “stabilizing the sector first.”

She adds in a statement that funding alone “cannot resolve the strain on our competitiveness.”

“We need a clear strategy with concrete actions and timelines to get more wood moving, attract investment, and protect forestry jobs and communities,” she says.

However, she says the $6.5 billion in support “recognizes forestry’s importance to Canada’s economy and comes at a critical time for workers, businesses and communities facing a deepening crisis in the sector.”

Forestry groups in B.C. have warned that the industry is at a breaking point, suffering numerous mill closures in recent years.

Haakstad says the money needs to flow soon.

“With the new funding beginning in 2027-28, timely implementation to address the sector’s immediate pressures is essential,” she said in the statement.

“Companies need improved conditions to keep operating today so they can invest in the opportunities of tomorrow.”

Ravi Parmar, the outgoing B.C. forests minister, says the federal money announced in the budget is a “good start” that reflects his government’s advocacy over the past two years for the sector.

“B.C. needs to get its fair share, Canada’s forest sector needs to get its fair share, when you think of the billions of dollars that have gone to the auto sector and the steel sector,” he said.

“So, kudos to the federal government for recognizing that.”

This report by The Canadian Press was first published Nov. 5, 2026.