Canada's Energy Minister Launches $500 Million Forestry Sector Initiative

On February 25, 2026, Canada's Energy and Natural Resources Minister Tim Hodgson unveiled a major initiative to bolster the country's forestry sector. This announcement came amid growing economic challenges and trade measures imposed by the United States.

In a media event held in Tracyville, New Brunswick, Hodgson revealed a $500 million commitment to open Calls for Proposals under the Natural Resources Canada's forest sector transformation programs. These measures are designed to foster innovation, diversification, and resilience within Canada's forestry industry.

Key Programs and Funding

The initiative includes several key funding programs open for applications, including:

• Investments in Forest Industry Transformation (IFIT): Aims to support innovation and create value-added wood products.
• Green Construction Through Wood (GCWood): Focuses on expanding the use of Canadian wood in construction, with an emphasis on mass timber.
• Indigenous Forestry Initiative (IFI): Designed to increase Indigenous participation in the forestry sector.
• Global Forest Leadership Program (GloFor): Seeks to open new domestic and international markets for Canadian wood products.

These programs align with broader strategic policies such as Buy Canadian and Build Canada Homes, which aim to prioritize domestic wood demand.

Immediate Regional Funding

Hodgson also announced $2.8 million in immediate funding directed towards seven projects in New Brunswick and Nova Scotia. These projects will focus on expanding mass timber use, supporting Indigenous and local businesses, boosting manufacturing capacity, and diversifying exports.

Economic Impact

Canada's forestry sector is a significant part of the nation's economy, employing nearly 200,000 people, including 11,000 Indigenous workers. It contributes over $20 billion to the national GDP, with an additional $2 billion to the GDP of the Maritimes, supporting approximately 19,000 jobs in that region.

In his address, Hodgson emphasized the importance of the forestry sector, stating: "Canada's forests are more than a resource. They are the foundation for good jobs, affordable housing, and sustainable economic growth."

This announcement builds upon previous government actions, including Prime Minister Mark Carney's measures in August 2025 for softwood lumber transformation and protections for steel and lumber announced in November 2025. Additionally, the Canadian Forest Sector Transformation Task Force, launched in January 2026, is expected to submit a report by April 18, 2026.

By implementing these programs, the Canadian government aims to enhance the competitiveness of the forestry sector, ensuring its long-term sustainability and contribution to the national economy.