By Leo Quigley, AJOT The dramatic slump in housing starts in the U.S. with the collapse of Wall Street had a major impact on British Columbia’s lumber industry and dozens of communities built on forestry and the forest industry. While the province has managed to make significant inroads into Asia during the downturn, the gradual recovery of the house building industry south of the border is good news to many families north of the border. In fact, RBC (Royal Bank of Canada) Economics has said in its most recent provincial outlook that British Columbia’s economic outlook looks dramatically different than last year’s when it experienced the worst slump since 1982. A big driver of the upswing, according to the report, is the rebound of the lumber industry. “One of the more encouraging developments in the provincial economy this year is the return to life of the long-suffering forest products sector,” the report said. In particular, the softwood lumber industry is benefiting from market conditions that are finally showing signs of turning around, with prices recently hitting four-year highs.” However the report said that while the lumber industry in the province is on the rise again it still has a long way to go before it reaches former levels. As well, British Columbia’s pulp producers are looking forward to better times as well. Pulp prices and markets have improved. In fact, in another recent report the Conference Board of Canada predicted that after several years of plant closures and restructuring the Canadian pulp industry can expect to return to profitability by next year. This, compared to previous years when the industry was forced to lay off half its workforce and swallow losses amounting to C$5 billion. In its report the board predicted that pulp and paper producers can expect to turn C366 million in pre-tax profits next year and trim this year’s losses to C$139 million compared to C$1.3 billion in 2009. In its report the RBC economists said: “Overall the British Columbia’s forest products sector has likely turned the corner, and prospects in the period ahead should be bolstered by a strengthening in the global economy and further healing in the U.S. housing market.” However, other factors are adding impetus to Canada’s lumber industry and one of those is the success traders have had in boosting Canadian lumber exports to China. According to the Random Lengths, a respected lumber industry publication, China’s lumber purchases from Canada jumped by 123 percent last year when compared to volumes in 2008. This, compared to U.S. exports to China that climbed 72 percent year-over-year.