Question-and-Answer Session
Operator
(Operator Instructions) Our first question will come from the line of Paul Quinn with RBC Capital Markets.
Paul Quinn - RBC Capital Markets
You mentioned fiber prices up in Germany in the upcoming quarters -- maybe you could try to quantify what we are going to see in terms of cost increase there.
David M. Gandossi
Well, we’re not really able to say in terms of Euros per cubic meter exactly but it’s just an upward pressure we are feeling, maybe having to procure logs from a little further away, you know, as supply tightens up with our buying pressure. You know, we might look in Poland, Czech, the Baltics, those kind of areas. So it could add a few Euros to the transportation cost. So it’s not significant but it is just general upward pressure as a result of the volumes.
Paul Quinn - RBC Capital Markets
So like year over year, something like 5% kind of number?
David M. Gandossi
Don’t know yet. That order of magnitude, 5% to 10%, I would guess.
Jimmy S. H. Lee
But it was trending down last year, so you know, if you compare it to last year’s wood prices versus what our expectations for this, it’s still going to be lower cost. But I think what we are seeing clearly is that the continued reduction of wood prices in Germany has stopped because of the withdrawal of the wood from the forest owners because of course the demand from the sawmilling side is such that it doesn’t make sense for them to continue to harvest at the rates that they would have in the past, and this is restricting the volume and therefore we have to look towards the other Eastern European markets where as you know, because of the global economic crisis, of course the wood activity there has been impacted a lot, the currencies have dropped a lot and therefore there is room for us to be able to source wood from areas which clearly were not our traditional sourcing grounds.
Paul Quinn - RBC Capital Markets
In terms of the Canadian green transformation program, has that gone through treasury board approval yet?
David M. Gandossi
Our information is that is expected to go through treasury board this week, and the industry has been invited to a conference call on August 6th. We will learn more about it. In the invitation, they indicated there would be an active website that would have the methodologies for measuring [black liquor] and its energy equivalents, as well as the forms that were necessary to make the applications and notifications regarding [black liquor] usage and so on.
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