The Government of Canada has announced a $500 million funding commitment to support the transformation and retooling of the country’s forest sector. The initiative, led by Natural Resources Canada (NRCan), aims to help companies modernize operations, diversify production and strengthen competitiveness in the face of ongoing U.S. trade measures.
The forest sector remains a key pillar of Canada’s economy and a lifeline for communities nationwide. The new funding is designed to protect jobs, provide short-term stability and support long-term growth rooted in Canadian resources and innovation.
The measures build on a series of actions announced in August 2025 by Prime Minister Mark Carney to help the sector remain competitive and unlock its full potential, particularly as the federal government scales up housing and major infrastructure development. Additional support followed with the creation of the Canadian Forest Sector Transformation Task Force, which began its work in January 2026.
As part of the latest step, the Honourable Tim Hodgson, Minister of Energy and Natural Resources, launched a national call for proposals under NRCan’s forest sector transformation programs, backed by the $500 million commitment.
Eligible businesses and organizations can now apply for funding through:
- The Investments in Forest Industry Transformation (IFIT) program
- The Green Construction Through Wood (GCWood) program
- The Indigenous Forestry Initiative (IFI)
- The Global Forest Leadership Program (GloFor)
These programs are intended to stimulate innovation and production diversification, drive domestic demand, expand the use of Canadian wood in construction, support Indigenous participation and open new domestic and international markets. They also align with broader federal strategies such as the Buy Canadian Policy and Build Canada Homes, which prioritize Canadian wood products.
In addition, $2.8 million in existing program funding was announced under IFIT, IFI, GloFor and GCWood to support seven projects in New Brunswick and Nova Scotia. The selected projects aim to expand the use of mass timber in construction, strengthen Indigenous and forestry business participation, increase manufacturers’ value-added capacity and diversify forest products and export markets. These initiatives reflect the type of innovation-driven projects the renewed programs are designed to advance.
By supporting workers, modernizing industrial capacity and helping companies access new markets, the federal government aims to ensure that the forest sector remains a cornerstone of national economic strength.
“Canada’s forests are more than a resource. They are the foundation for good jobs, affordable housing and sustainable economic growth. Today’s announcement makes sure that the forest sector remains a pillar of national strength, an economic engine for communities across the country and a major exporter of our products to the world. This is how we protect what we have while building stronger for tomorrow,” said The Honourable Tim Hodgson, Minister of Energy and Natural Resources.
“These investments are about supporting workers today and building a stronger future for forestry communities in Fredericton, New Brunswick, and across the country. By modernizing the sector and opening new opportunities, we are investing in our own resilience and building Canada Strong,” added David Myles, Parliamentary Secretary to the Minister of Canadian Identity and Culture and Minister responsible for Official Languages and to the Secretary of State of Nature.
Sector impact
Canada’s forest sector supports nearly 200,000 workers, including more than 11,000 Indigenous employees, and contributes over $20 billion to national GDP. In the Maritime provinces alone, the sector supports almost 19,000 jobs and contributes nearly $2 billion to real GDP, representing approximately 1.6% of the region’s total GDP.
To simplify access to federal programs, NRCan has also launched a new single-window pathfinding service, including a dedicated website and direct access to department experts to assist forest sector businesses and employees in navigating available funding opportunities.
