CANADA'S FORESTRY FLEXIBILITY AND FORTITUDE 

CANADA has taken decisive actions to defend its vital forestry industries and communities in recent months as trade disputes with the US continued to ramp up.

Federal and regional governments have united to safeguard forest industry workers, businesses and supply chains so one of Canada’s most powerful economic engines can remain globally competitive.

A series of impressive funding and investment packages have been rolled out by government administrations since early June. 

Each aims to bolster Canada’s forest sector which supports nearly 200,000 workers and more than 300 rural communities.

Just this week the Peace River region in Northern Alberta, where Power Wood Energy will soon construct two large black pellet production facilities, was placed at heart of this national forestry revival effort.

Mercer Peace River Pulp Ltd., on the western shore of Peace River, a few kilometers north of the town of Peace River, has underpinned economic activity in the region since 1990. 

Its expansive pulp and paper facility supports approximately 3,000 jobs across its broader forest sector supply chain.

Now it has been awarded federal funding to reduce its production costs, untertake a program of modernization and strengthen its competitiveness in changing global markets. [1]

Production at the mill contributes nearly $1.5bn to Alberta’s economy every year, so the $20m investment package announced by Eleanor Olszewski, Minister of Emergency Management and Community Resilience and Minister responsible for Prairies Economic Development Canada (PrairiesCan), looks like money well spent.

This targeted package includes $1m in non-repayable contribution funding. It also provides $19m in repayable federal funding. 

Additionally, Alberta’s Minister of Forestry and Parks Todd Loewen explained that the government will supplement the investment with $17.1m of direct relief.

Citing the United States’ tariff war on the world, the Honourable Eleanor Olszewski said: “Canada did not choose this trade conflict with the United States, but we will stand up for the workers, businesses and communities under pressure.

“For more than 35 years, Mercer Peace River has been an anchor of northern Alberta's economy. This $20 million investment will help the mill modernize, compete and protect the good jobs that families across the region depend on as we build a stronger, more resilient Canadian economy.” 

Jobs across Alberta's entire forestry supply chain are under threat from aggressive tariff tactics employed by the US to hurt Canada's economy. 

Forestry and Parks Minister Todd Loewen added: “The Mercer Peace River mill has been a cornerstone of the Peace region economy for more than three decades, and our government wants to see that continue.

“Innovation has long been the path to success in Alberta and Mercer is well positioned to transition to a new and diversified business model that will sustain its operations for years to come.”

The Honourable Tim Hodgson, Minister of Energy and Natural Resources, affirmed: “Canada's forest sector creates good jobs and drives economic growth in hundreds of communities across the country, including in Peace River.

“Our government is proud to invest in Mercer Peace River's modernization, so the Canadian forest sector can not only survive but thrive, and become stronger, more competitive more resilient for years to come.”

These targeted regional efforts build on a massive national defense framework assembled to withstand the steep and unjustified US tariffs experienced by Canadian manufacturers during 2026. [2] [3] [5] [6]

After Washington imposed a 50 percent tariff on $27.6bn of Canadian goods, Canada this week quickly suspended trade negotiations and matched all new US tariffs dollar for dollar, to protect its national interests - effective from September 8th. 

To bolster impacted businesses, Canada then unveiled a comprehensive $7.5bn national support package. 

It includes $1.5bn for its Regional Tariff Response Initiative and $2bn through the new Canada Strong Diversification Fund. Another $3.5bn has been directed towards Rapid Response Supports for Workers and Employers.

It all builds on nearly $25bn in supports that the Canadian government has provided since Donald Trump imposed tariffs on his Canadian cousins. 

Pulp mills in Alberta are among many forestry businesses feeling the support of federal and regional financial investment rescue packages designed to help them reduce production coasts, renew plant infrastructure and technologies, and innvoate into new markets.

Canada’s federal Minister of Finance and National Revenue, François-Philippe Champagne, stated on August 25th: “When the United States asked too much and offered too little, we chose to stand up for Canadians. [7] [8] [9]

"In a more uncertain world, Canada will continue to invest in our greatest strengths, our workers, our businesses and our capacity to compete.

“Today’s new measures will protect jobs, strengthen the industries that drive our economy, and secure the supply chains that underpin our prosperity.

“Canada will not simply respond to change, we will shape it, growing a stronger economy that delivers opportunity, security and prosperity for Canadians.”

The announcements come soon after the publication of a report by Canada’s Forest Sector Transformation Task Force.

Titled ‘Canada's Transformed Forest Sector: Competitive. Resilient. Relevant’, it calls for a 25-year national forest sector strategy led by federal government from 2026 to 2050. [4]

The Peace River region has been the centre of recent focus after Alberta's Minister of Emergency Management and Community Resilience, and Minister responsible for Prairies Economic Development Canada (PrairiesCan), Eleanor Olszewski announced a $20m investment package for the Mercer Peace River Pulp mill.

The backdrop for the report is a sector under significant pressure. Since August 2025, more than a dozen sawmill have closed and 40 temporary curtailments have directly affected more than 3,000 jobs, with further impacts across logging, pulp and paper, wood pellets and remanufacturing.

The task force’s report prioritizes six areas:

• Securing long-term access to cost-competitive fibre

• Catalyzing transformation at scale

• Increasing domestic demand for wood in construction

• Stabilizing the workforce and supporting communities

• Defending market access and trade infrastructure

• Rebuilding a national forest culture

Power Wood Energy is gearing up to play its part in supporting Canada’s forestry sector with extensive plans to build out the country’s biofuel industry across multiple Provinces, at pace.

Its black pellet operations will create greater demand for forestry residuals, generate change and diversity in the wider forestry sector - and stabilize and galvanize industry workforces, employment levels and communities.

It will also open up new export markets for Canada’s forest-based economy.

Power Wood Energy’s Chief Executive Chairman David Peters said: “I feel certain that the full financial support brought forward by Canada’s federal and regional governments is being met with huge appreciation in all forestry communities across the nation.

“While the economic difficulties faced by forest-based businesses, workers and communities are unquestionable, in certain ways, the US’ unjustified tariffs have only served to make Canada’s forestry sector stronger and more united.

“I believe it is already rallying and rising, with resilience and zeal, in the face of its challenges and that it will become something much greater than it was before for this period of adversity.

“Power Wood Energy is doing everything possible to put itself in a position where it can contribute to the coming years of renewal and transformation that will occur within Canada’s and Alberta’s forest economies, thanks to federal and regional government supports.”  

[1] CBC. (2026, August 28). Alberta pulp mill under pressure from Trump’s tariffs gets $20M in federal support. https://www.cbc.ca/news/canada/edmonton/federal-funding-peace-river-pulp-mill-tariffs-9.7324289

[2] Bioenergy Insight Magazine. (2026, June 5). Canada announces hundreds of millions for forest sector transformation. Bioenergy Insight Industry News. https://www.bioenergy-news.com/news/canada-announces-hundreds-of-millions-for-forest-sector-transformation/

[3] Government of Canada, Natural Resources Canada. (2026, June 3). Canada advances forest sector transformation to protect jobs and strengthen communities nationwide. Canada.ca News Releases. https://www.canada.ca/en/natural-resources-canada/news/2026/06/canada-advances-forest-sector-transformation-to-protect-jobs-and-strengthen-communities-nationwide.html

[4] Government of Canada, Natural Resources Canada. (2026, June 4). Canadian Forest Sector Transformation Task Force final report: A 25-year strategy for Canada's forest economy. Government of Canada Publishing. https://natural-resources.canada.ca/sites/admin/files/documents/2026-06/CFS-Transformed-Task-Force-EN.pdf

[5] Government of Canada, Natural Resources Canada. (2026). Support for Canadian workers and businesses affected by U.S. tariffs. https://www.canada.ca/en/department-finance/news/2026/08/support-for-canadian-workers-and-businesses-affected-by-us-tariffs.html

[6] Government of Canada, Natural Resources Canada. https://natural-resources.canada.ca/forests-forestry/forest-industry-trade/support-forest-sector-employers-workers

[7] Forest Products Association of Canada. (2026, August 24). FPAC calls for immediate action as new U.S. tariffs hit Canada’s forest sector. FPAC Press Releases. https://www.fpac.ca/posts/fpac-welcomes-federal-action-to-support-tariff-affected-industries

[8] CTV News. (2026, August 24). Alberta and federal government align to protect natural resource sectors amid escalating U.S. tariffs. CTV News Business & Economics. https://www.ctvnews.ca/edmonton/article/alberta-getting-off-lightly-in-wake-of-us-tariffs-economist/

[9] Financial Times (2026, August 25). Canada announces $20bn retaliatory tariffs as US trade war escalates. https://www.ft.com/content/7ced71c2-03b8-4569-a68d-14624a7e83f2?syn-25a6b1a6=1

[10] BuildCanada Policy Tracker. (2026, August 4). Federal government delivers over $2.6 billion in liquidity and loan guarantee measures for Canadian forest operators. BuildCanada Economic Monitor. https://www.buildcanada.com/tracker/commitments/2677