Review of Canada’s Wooden Pallet/ Wood Packaging Industry Canadian Wood Pallet & Container Association Gordon Hughes August 31, 2005

Overview W near 300 members WRepresenting 85% of the mfg. wooden pallets in Canada W70% of membership are manufacturing W30% are associate suppliers WRepresented in every geographic sector of Canada – East/Central/Prairie/West

Industry Background - it is estimate that our total sales for wood pallets/wood packaging/allied produces is $465 million yearly. - USA corporations are our largest purchasers of Canadian wood pallets/wood packaging - Automotive sector is the largest purchaser, followed by general manufacturing and then the food sector.

CWPCP - Certified Wood Packaging ° Canada’s IPPC-ISPM 15 policy is called the Canadian Wood Packaging Certification Program – D °near 440 wood pallet/packaging companies certified to manufacture and supply consumers °Canadian Food Inspection Agency continues to regulate and audit this program.

History of Certified Wood °June 2000, 1 st FAO-IPPC Meeting in Ottawa, Canada – to discussing the transport of quarantine pests. °Oct. 2001, EU regulated the softwood from Canada, USA, China and Japan °March 2003 – IPPC-ISPM 15 document °November 2004 – New Zealand first to regulate. °Canada full regulation September 16, 2005

Canada D due to the early regulation by the EU, Canada has embraced certified wood packaging - consider this program as a positive step to servicing our consumers. - catapulted our industry sector to one that is valued and involved in the success of any exporting company.

What has ISPM 15 Accomplished - added customer base 4 many companies, prior to ISPM 15, manufactured their own export light/heavy wood packaging – ie Hitachi, Caterpillar, Canadian Dept. of Defense 4 today, those companies now our customers, we are the experts and the only industry regulated to certify wood pallets/packaging for export.

Damage Control 1.Canadian dollar now $.845 = $1. USD 2.Softwood Lumber Agreement at a standstill 4 USA refuses to negotiate return of $3.5 billion in tariffs 4 US lumber lobby continue to rule and direct the negotiations 3.Made in Canada – to identify wood packaging made in Canada.

Present & Future 1.HT/KD Kilns hot 2.Growth due to positive economy in Canada & USA. 3.Regulated Softwood Lumber Agreement 4.Educate consumers to ISPM 15 regulation 5.Commitment to ISPM 15 and to protect the integrity of this program.

Present & Future 6.Create Safe Workplace for employees to assist member in reducing loss time injuries 7.Promote wood as the only alternative to the delivery of any unit load. 8.Promote value added – ie – ISPM 15 – Pallet/crate Design 9. Gain respect as the professionals