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Warning labels on individual cigarettes aim to deter kids, convert parents

Christopher Reynolds, The Canadian Press

An example of cigarette packaging with expanded warnings, including a warning printed on the cigarettes themselves, is shown on a screen after a news conference on expanded regulations for tobacco products, in Ottawa, on Friday, June 10, 2022. THE CANADIAN PRESS/Justin Tang

A fresh set of Health Canada regulations that will require warning labels on individual cigarettes is set to come into effect Tuesday.

The move, announced earlier this year, makes Canada the first country in the world to take that step in the ongoing effort to help smokers kick the habit and deter potential puffers from picking it up.

The wording that will eventually be on every cigarette, written in English and French on the paper around the filter, ranges from warnings about harming children and damaging organs to causing impotence and leukemia. "Poison in every puff," cautions one.

The labels will dissuade teens leaning toward taking up the habit and push nicotine-dependent parents looking to fight it, predicted Rob Cunningham, a senior policy analyst at the Canadian Cancer Society.

Once the regulations take effect, manufacturers have until the end of July 2024 to ensure the warnings are on all king-size cigarettes sold, followed by regular-size cigarettes and little cigars with tipping paper and tubes by the end of April 2025.

"For youth who experiment by 'borrowing' a cigarette from a friend, it's going to mean they will see the cigarettes — even if they may not see the package — where the warnings appear," Cunningham said in a telephone interview. "It's going to prompt discussion, including by smokers during smoke breaks: 'What warning have you got today?'

"Often it's kids who are urging their parents to quit, and this provides new information and messaging," Cunningham said.

Dozens of studies in Canada and elsewhere show the effectiveness of printing warnings on each cigarette, he noted.

Tobacco use continues to be one of Canada's most significant public health problems and remains the country's leading preventable cause of disease and premature death, then-health minister Jean-Yves Duclos said in a May 31 statement announcing the new warning labels.

About 15 to 20 per cent of patients with cancer are smokers at the time of diagnosis, with a higher percentage for certain types, such as lung cancer and head and neck cancers, said Dr. Lawson Eng, a medical oncologist at Toronto's Princess Margaret Cancer Centre and assistant professor in the University of Toronto’s department of medicine.

He couldn't say "for sure" that the messaging will reduce rates, but he noted that past efforts have succeeded in tandem with other public health measures, such as including cessation strategies in cancer screening and care.

"I suspect it will likely continue to help with decreasing smoking prevalence and also help with encouraging people who are smoking to try to quit," Eng said.

Tobacco advertising, promotion and sponsorship are banned in Canada, with warnings on cigarette packs dating back to 1972.

In 2001, Canada became the first country to require tobacco companies to print pictorial warnings on the outside of cigarette packages and include inserts with health-promoting messages.

More than 130 countries have followed suit, according to the Canadian Cancer Society.

Not all smokers view the escalating warnings favourably.

"I don't think that will really change much. A lot of people will continue to smoke," said Giovany Lincourt. "When I see a photo of a black lung, it hits me, but I still continue because it's a bad habit."

The 40-year-old Montrealer, who sampled his first cigarette at age 16, said still higher taxes would make a better deterrent. A pack of 25 typically costs between $11 and $16, depending on the brand and province.

"It hurts the wallet, because it costs $400, $500 a month," Lincourt said.

Blunt statements, including "Tobacco smoke harms children" and "Cigarettes cause cancer," will be among the first six messages. A second set of six is expected to be printed on cigarettes in 2026. Organizations funded by tobacco companies have opposed the push toward stronger messaging, including the latest step.

The National Coalition Against Contraband Tobacco warned in June that cheaper, colourful black-market packs free of health warnings — federal rules ban packaging that includes brand colours or trademarks — attract young smokers and funnel more money to organized crime.

Much of the coalition's funding comes from the Canadian Tobacco Manufacturers Council, made up of three of the biggest cigarette companies active in Canada: Rothmans, Benson & Hedges Inc., Imperial Tobacco Canada and JTI-Macdonald Corp.

While big tax hikes or outright sales bans would indeed benefit the black market, gradual price boosts and more strident messaging can bring down smoking rates, Cunningham said.

"The only real reason that they can oppose something is because it's going to have a reduction in sales — and that is exactly the point," he said of the manufacturers.

The Canadian Cancer Society and other advocacy groups are calling for a comprehensive strategy of beefed-up taxation, legislation and programming to bring down smoking rates — Health Canada's goal is less than five per cent of the 15-plus population by 2035 versus 13 per cent as of 2020. Price promotions and flavoured products — allowed in some provinces — should be banned, Cunningham said.

In May, the Canadian Cancer Society, the Canadian Lung Association and the Heart and Stroke Foundation published an open letter to premiers of all 10 provinces saying they should push for efforts to reduce smoking during settlement negotiations with three major tobacco companies that they sued years ago to recoup health-care costs.

Provinces are collectively seeking $500 billion in damages, and the three advocacy groups said at least 10 per cent of the money from a settlement should go toward smoking cessation efforts.

This report by The Canadian Press was first published July 31, 2023.

— With files from Camille Bains in Vancouver

 

Canada turns to Nuclear power after 30-year pause to meet demand surge

Curtis Heinzl, Bloomberg News

The wet storage area for spent fuel bundles is seen at the Darlington Nuclear generating station 

in Bowmanville, Ontario, Canada, on Friday, April 1, 2016. , James MacDonald/Bloomberg

Nuclear energy is gaining significant momentum in Ontario, with new plans to expand an existing plant to become the world’s largest and a pledge to add three small modular reactors to a site where another is already being built.

The news marks a shift for an industry that has been stalled for decades amid fears about safety and cost overruns. It’s also seen as a critical step in modernizing an aging power grid that needs to add capacity without boosting already-high electricity costs, or threatening emissions goals.

The 2011 Fukushima Daiichi meltdown — the worst disaster since Chernobyl — slammed the global brakes on nuclear power plans. The Vogtle debacle in the US also provided grist for nuclear’s opponents, in the form of years-long delays and a price tag US$16 billion over budget.

Still, Ontario is charging ahead. The newly announced expansion at the Bruce Power facility marks the first large-scale nuclear build in Canada in over three decades, suggesting nuclear policy may finally be becoming unstuck. The province is home to all but one of the country’s 19 nuclear reactors, most of which were built from the 1960s to 1980s, during which time the Candu reactor became a global favorite.

“We are returning to our nuclear roots, and it couldn’t happen at a more important time,” said John Gorman, president of the Canadian Nuclear Association. As global demand for clean energy soars, Canada is once again poised to be a supplier of nuclear reactors domestically and internationally, he said.

By 2050, Ontario will need to spend about $400 billion (US$303 billion) to double its generating capacity to 88.4 gigawatts, according to the agency that runs the province’s electric grid, as drivers switch to electric vehicles and homes and businesses gradually move away from fossil fuels. Canada’s largest province is also seeing rapid population growth due to immigration. 

Thanks to existing nuclear, hydroelectric and wind power, Ontario’s grid is already 90 per cent clean. But growing demand could make that final 10 per cent the hardest to reach. Nuclear projects take many years to finish, and with all three of Ontario’s nuclear sites due for refurbishment this decade, the province will see a temporary cut to generating capacity. While construction is underway, the province plans to backstop supply with more natural gas.

DUMPING POWER

Once complete, the nuclear projects will reduce the province’s reliance on natural gas. They will also lessen the need to use wind and solar power to meet base-load demand — the minimum level of power needed from an electrical grid at any time — which contributes to a costly mismatch between supply and demand.

Electricity demand typically ramps up in the morning, peaks late afternoon, and tapers off at night. But supply from intermittent renewables like wind and solar is weather-dependent, and therefore less reliable at meeting the demand of the hour. Sometimes intermittent sources generate less power than is needed, and sometimes more — in which case operators may need to pause generation at certain plants to avoid overloading the system.

“At night, wind fights with nuclear and hydroelectric. During the day, wind and solar fight each other for the peak. So something has to be curtailed,” said Paul Acchione, a longtime engineer who co-authored a report on electricity price projections for the Ontario Society of Professional Engineers.

Hydroelectric power is usually first to be curtailed because its production carries a water rental tax, Acchione said. “If you put too much wind and solar on the Ontario grid, you end up dumping water into Niagara Falls.”

While intermittent renewables produce the cheapest electricity of any source, they aren’t yet reliable enough to replace natural gas, which is why the latter is still the backstop during times of peak demand and grid outages.

“Wind and solar are really, really cheap sources of power, but you need to be concerned with addressing their intermittency,” said Jason Dion, senior research director of the Canadian Climate Institute. “The challenge grows as their share of overall generation grows.” 

That’s where advancements in energy storage come in, allowing excess power generated in periods of low demand to be saved for peak times.

Storage currently covers only about 0.5 per cent of Ontario’s total generating capacity, but the province will grow its battery capacity 24-fold in the next three years, according to a July report by the energy ministry. The government also has future plans to add more pumped storage hydropower, a longer-duration storage option that moves water uphill to be run through a turbine later on.

CONTAINING COSTS

Acchione’s group modeled eight different scenarios for creating a net zero electricity supply in 2035, the year by which the Canadian government has pledged to have an emissions-free grid.

The simulation found expanding both nuclear capacity and long-term electricity storage is the best way to keep rates as low as possible. In the most optimal scenario, nuclear and hydroelectric power would meet base-load demand, while intermittent sources propped up by pumped storage would kick in during peak hours — resulting in a 10 per cent rise in electricity costs. That’s about the same as residents could expect if the province simply expanded its 2021 energy mix, without the added carbon emissions.

The two new projects at the Bruce and Darlington nuclear generating stations will add 6,000 additional megawatts of capacity to the grid once complete. Ontario can achieve Canada’s net zero electricity goal as long as they arrive on schedule, and assuming demand projections are accurate, Acchione said.

“The energy planners here in Ontario are starting to appreciate the various moving parts that play into the design of an energy supply mix,” he said. “It’s a good announcement. It’s a good start.”

Canadian drought conditions could force ranchers to sell their cattle

Iva Poshnjari, BNN Bloomberg

Cattle ranchers in parts of Western Canada are battling with drought conditions that might set them back years, the Canadian Cattle Association is warning. 

As of June, 83 per cent of the four westernmost Canadian provinces – Manitoba, Saskatchewan, Alberta, and British Columbia -- were abnormally dry and experiencing moderate to severe drought conditions, according to Agriculture Canada. 
 
These conditions make it challenging for cattle farmers to maintain their livestock and keep business operations going, Tyler Fulton, vice president of the Canadian Cattle Association, told BNN Bloomberg on Tuesday. 
 
As significant parts of Western Canada continue to experience serve drought conditions, some ranchers will have to sell their calves or cows in order to reduce financial strain, he explained.  
 
“What will happen is that some of those animals will go market, will go to slaughter, and that will impact their (the farmers’) economic viability going into future years,” he said. 
 
The drought has left ranchers between a rock and a hard place, Fulton added. 
 
“They’re dealing with several years of drought conditions, which means their pastures have deteriorated so they’re not producing anything. Their winter feed production is next to nothing simply because we rely on moisture to produce those crops,” he explained. 
 
At this point, it will come down to planning, he added. 
 
“There are pockets that are in a really tough time,” Fulton said. 

B.C. port strike cost CPKC railway $80 million, exec says

Christopher Reynolds, The Canadian Press

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The B.C. port workers' strike deprived Canadian Pacific Kansas City Ltd. of scores of millions of dollars, its chief marketing officer said, tacking on a costly coda to a tough quarter.

"At this point, we're estimating the strike had a negative impact of about $80 million in revenue, much of which we will work hard to claw back over the remainder of Q3 and Q4," John Brooks told analysts on a conference call Thursday.

The 13-week strike — plus a brief wildcat job action — earlier this month halted operations at most ports along the West Coast. In the first week alone, it depressed the number of containers hauled by Canadian railways to barely half the level reached during the same period in 2022, according to the American Railroad Association.

CPKC framed its first quarter following a major merger as a tough one, as demand for container shipments and some bulk goods fell across the rail sector.

“No doubt a challenging quarter as we dealt with a softer demand environment,” CEO Keith Creel said on the conference call.

In April, Canadian Pacific Railway Ltd.'s purchase of Kansas City Southern was completed. The US$31-billion deal — the continent's first big rail merger in more than two decades — created the only railway stretching from Canada through to the U.S. and Mexico.

In the quarter ended June 30, CPKC saw revenue nudge up two per cent compared with the two formerly separate railways' combined results from a year earlier, Brooks​​​ said. Overall volume fell five per cent.

He said revenues from container traffic dropped 10 per cent in the second quarter versus the combined figures from a year earlier, as consumers rerouted their spending toward services over products in a reversal of pandemic trends.

In better years, the corrugated steel boxes, which haul everything from kitchenware to construction materials, accounted for about a quarter of Canadian Pacific Railway's total revenues, rather than one-fifth as they did in CPKC's second quarter this year.

Grain volumes also fell five per cent year over year, while potash shipments and revenue plummeted 18 per cent — despite heightened global demand — due to a "major mechanical failure" in April at the Canpotex bulk terminal in Portland, Ore., Brooks said. The operation is not expected to come back online until 2024, as CPKC works to divert fertilizer to other ports.

“This is a long game, it’s not about the first quarter (following the merger)," Creel said, though he also acknowledged the snarls caused by the strike. “This is not to say that everything’s been perfect."

On the plus side, the railway hauled higher volumes of "frac sand" and steel as well as automotive products amid ongoing demand for parts and finished vehicles.

The benefits of a single-line service across the continent will also become more apparent as CPKC moves lumber from British Columbia to legacy markets of Kansas City Southern, Brooks said, "although we are seeing the impacts of a softer economy on residential construction and related building products."

Creel said long-term growth opportunities are "undeniable" given the greater reach of the merged outfit.

Employing roughly 20,000 people, the freshly fused rail network stretches from Vancouver and Saint John, N.B., to Houston and Mexico City, reaching the Gulf of Mexico and the Pacific Ocean.

Consistent with the trend of labour hoarding, CPKC is "carrying surplus headcount and incurring additional expense" at the moment, said chief financial officer Nadeem Velani. "However, as the growth comes on in the second half and into 2024, we will be prepared to handle it with strong ... margins," he said.

On Thursday, CPKC reported total revenues of $3.17 billion in its second quarter, compared with $2.20 billion a year earlier at CP — well before the marriage of North America's two smallest Class 1 railways in April.

Net income reached $1.33 billion versus $765 million the year before, the railway operator said.

The Calgary-based company said diluted earnings notched $1.42 per share, above the 82 cents per share of the same period in 2022.

This report by The Canadian Press was first published July 27, 2023.

 

CPKC chief exec cites 'challenging' three months following railway merger

The Canadian Press

Canadian Pacific Kansas City Ltd. framed its first quarter following a major merger as a tough one, as demand for container shipments and some bulk goods fell across the rail sector.

“No doubt it's a challenging quarter as we dealt with a softer demand environment,” said CEO Keith Creel on a conference call with analysts Thursday.

The company reported that revenues from container traffic, which moves everything from kitchenware to construction materials, fell 10 per cent in the quarter ended June 30 compared with the two railways' combined results from a year earlier as consumers spent more cash on services rather than products.

In better years, the corrugated steel containers have accounted for about a quarter of Canadian Pacific Railway's total revenues, rather than one-fifth as they did in its second quarter this year. 

Grain volumes also fell five per cent year over year while potash shipments plummeted.

“This is a long game, it’s not about the first quarter (following the merger)," Creel said, though he acknowledged the snarls caused by the B.C. port workers' strike earlier this month. “This is not to say that everything’s been perfect."

On the plus side, the railway hauled higher volumes of "frac sand" and steel as well as automotive products.

Creel said long-term growth opportunities are "undeniable" given the greater reach of the merged outfit.

CP's US$31-billion purchase of Kansas City Southern — the continent's first big railway merger in more than two decades — created the only railway stretching from Canada through to the U.S. and Mexico.

On Thursday, CPKC reported total revenues of $3.17 billion in its second quarter, compared with $2.20 billion a year earlier at CP — well before the marriage of North America's two smallest Class 1 railways in April.

Net income reached $1.33 billion versus $765 million the year before, the railway operator said.

The Calgary-based company said diluted earnings notched $1.42 per share, above the 82 cents per share of the same period in 2022.

Let's make a deal, Canada urges U.S. amid latest 'baseless' softwood lumber duties

The Canadian Press

Canada is urging the United States to make a good-faith effort at negotiating an end to the interminable bilateral dispute over softwood lumber. 

International Trade Minister Mary Ng is making the overture after a fresh U.S. Commerce Department review maintained duties on softwood imports from Canada.

Ng says the duties, while modestly lower, remain an unfair, baseless and punitive measure that hurts the economy on both sides of the border. 

She says a negotiated settlement is the only way the two countries will ever fully resolve the decades-old dispute. 

Such a deal is unlikely: the U.S. has a fundamental problem with a regulatory regime in Canada that it says puts American producers at a disadvantage.

U.S. Trade Representative Katherine Tai has said the U.S. would be willing to negotiate, but only if Canada does away with its provincial stumpage fee system. 

"An immediate negotiated solution to this long-standing trade issue is in the best interests of both our countries," Ng said in a statement.

"Canada is disappointed that the United States is not meaningfully engaging in discussions on a return to predictable cross-border trade in softwood lumber." 

The Commerce Department established a combined "all others" duty rate of 7.99 per cent, only slightly less than the 8.59 per cent established after the last administrative review. 

Ottawa, meanwhile, will keep up the fight through the dispute resolution tools in the U.S.-Mexico-Canada Agreement, the World Trade Organization and the courts in the U.S., Ng said. 

"The only fair outcome would be for the United States to cease applying these baseless duties." 

In Canada, lumber-producing provinces set so-called stumpage fees for timber harvested from Crown land — a system that U.S. producers, forced to pay market rates, say amounts to an unfair subsidy.

Federal officials in Ottawa have said Canada would never agree to implement such a fundamental change to the way a key Crown resource is managed before the two sides have even sat down.

This report by The Canadian Press was first published July 27, 2023.

Canfor Corp. reports $43.9M loss in second

quarter amid tough pulp, lumber conditions

The Canadian Press

Wildfires in Western Canada continue to disrupt Canfor Corp. operations as the company reported a loss of $43.9 million in the second quarter.

With new records set in both Alberta and B.C. for total hectares burned, the company said operational constraints are expected to continue well into the third quarter of 2023. The extreme conditions are also disrupting the company's access to fibre as well as harvest and hauling activities, Canfor said.

"While it is too early to determine the long-term fibre supply impacts, we have seen significant short-term disruptions to our operations, including a three-week curtailment of our facility in Fox Creek, Alberta in the second quarter," said Canfor president and CEO Donald Kayne on a call with analysts. 

The company said it will assess the full extent of the fires' impact on its operations, including sustainable timber supplies and future harvesting plans, over the coming months. 

The loss in the second quarter was down from the $373.8 million profit Canfor reported during the second quarter last year. However, it was an improvement from the first quarter, when Canfor reported a loss of $142 million. 

Declining global pulp market conditions weighed heavily on its results in the second quarter, the company said in a press release Thursday, as did pressure on global lumber market fundamentals and pricing. 

European and U.S. South operations were strong, helping partially offset weaker results from the company's western Canadian lumber business, Kayne said in the release. 

Sales during the second quarter were $1.45 billion, down from $2.17 billion a year earlier. 

The recent strike at B.C. ports will likely weigh on Canfor's results in the third quarter, said RBC analyst Paul Quinn in a note. 

The strike "severely impacted" the supply chain for subsidiary Canfor Pulp Products Inc., said the company's president and CEO Kevin Edgson on the analyst call. Around 70 per cent of the company's pulp is shipped through the affected ports, and so the strike led to a weeklong curtailment at the Northwood pulp mill. 

"We anticipate the supply chain challenges to persist through much of the third quarter," said Edgson. 

Canfor Pulp reported a net loss of $28.4 million in the second quarter, down from a loss of $5.7 million a year earlier. Sales were $249.5 million, down from $288.9 million last year. 

Overall, Canfor Corp.'s second-quarter earnings were better than expected, said Quinn, noting that the company expects lumber markets to benefit from a slight improvement in residential construction activity in the third quarter. 

High interest rates are expected to keep existing home inventories at low levels of supply, Canfor said in its release. 

"It is anticipated that new homebuilders will continue to offer concessions, however, in an attempt to potentially relieve some affordability pressures for prospective homeowners. As a result, residential construction activity is projected to experience a slight improvement through the third quarter of 2023 as the underlying demand for housing in North America remains."

This report by The Canadian Press was first published July 28, 2023.