Forestry and logging

Owning trees that grow whether or not anyone is working is a real proposition, and it is the landlord's side of the forest rather than the contractor's side screened at Contract Logging. The cut is what the land pays at the scale where it is run well. Acadian Timber holds about 775,000 acres of freehold in New Brunswick and 300,000 in Maine. In 2025 that estate produced C$87.0M of sales and C$15.8M of adjusted EBITDA — an 18% margin, and under C$15 an acre even before stripping out the services it sells on 1.3 million acres of Crown licence [A]. Free cash flow was C$6.6M against C$20.9M of dividends declared. The year before, it took C$24.6M of carbon-credit sales to lift the result; in 2025 there were none. And the owner does not set the price: sawlogs and pulpwood go to whichever few mills sit inside haul distance, and Acadian's own outlook says pricing may stay challenged until lumber markets improve. A timber tract cannot be started, only bought, and the purchase price is almost the whole business — 73% of the 172 Canadian establishments have one to four employees because there is little to operate. An entrant buys a low cash yield, takes the mill's price, and lacks the acreage over which a forester, a road network and a carbon programme are spread.

The pre-screen called this low-capital and under-served, and the first half survives: a container nursery is greenhouses, a cold store and seasonal labour, not a mill. The second half does not. Seedling demand is a legal by-product of logging. In British Columbia tenure holders are required by law to regenerate the areas they harvest [A], so a nursery's order book is next year's cutblocks, sown a season or more ahead under contract to the same licensees who are curtailing mills. That book is shrinking. The province planted more than 280 million trees in 2024 [A]; planting is expected to fall to 238 million in 2025 and 226 million in 2026, a third consecutive decline that tracks the drop in harvest [B]. The obvious replacement demand — burned forest — has no payer: the nursery associations put replanting 15% of the 2023–24 burn at more than 880 million extra seedlings in British Columbia alone, capacity that does not exist and that waits on government funding [B]. Meanwhile one operator, PRT, grows over 600 million seedlings a year across 28 nurseries [B], against a Canadian industry the trade association puts at about C$256M. The 129 establishments are unusually top-heavy for a farm code — 22% have twenty or more employees. An entrant would be adding capacity to a shrinking, contract-bound volume already served at scale. Gathering of wild forest products, the other half of this code, was not examined.

Contract logging sits downstream of the fibre shortage documented at 321, and 2026 made that concrete: Canfor permanently closed the Northwood pulp mill in Prince George on 14 July 2026, taking out 300,000 tonnes a year of NBSK and about 300 jobs, and closed the Fox Creek sawmill in Alberta two weeks later, citing weak markets, US duties and fibre supply hit by wildfires and the end of the mountain pine beetle strategy. A contractor's volume is whatever the licensee allocates, and when a mill goes the allocation goes with it. West Fraser, the largest customer in the country, billed US$5,462M in 2025 against US$6,454M two years earlier. Rates are set by the mill, equipment payments are not, and a curtailment transfers directly onto the contractor's balance sheet. British Columbia legislated around exactly this problem — written contracts, replaceable terms, rate disputes to mediation and arbitration — which is the clearest evidence that the bargaining position does not work on its own. A regulated remedy for a bad price is not the same as a market, and it is the most exposed position in the forest supply chain.