(Removes reference to Ainsworth Lumber in paragraph 5. Ainsworth is no longer part of IFLRA)
* Dispute in British Columbia southern interior region
* No contract since mid 2009
* Industry has started to recover
By Allan Dowd
VANCOUVER, April 18 (Reuters) - Forestry workers in British Columbia's southern interior region say they are ready to strike after failing to agree a new contract in nearly two years of talks.
A government mediator was called in last week after the United Steelworkers union filed 72-hour strike notice against member companies of the Interior Forest Labor Relations Association.
Any job action by the 4,000 union members in the region is on hold pending mediated talks this week. A union official said the sides will know quickly if they can break the impasse.
"We've been at this for too long," Bob Matters, chairman of the union's Wood Council said on Monday.
The IFLRA was not immediately available for comment. Its members include Tolko, Tembec (TMB.TO), Weyerhaeuser-Canada, a unit of Weyerhaeuser Co (WY.N), and several smaller firms. The workers have been without a contract since June 2009.
British Columbia is Canada's largest lumber-exporting province. Some employers negotiate labor agreements individually, but most firms bargain in regional associations.
The union said the IFR has refused to accept a pattern agreement that resulted in contracts last year with forestry firms in northern British Columbia and Canfor Corp (CFP.TO)
Those four-year deals froze wages in the first two years of the contract with 2 percent increases in each of the last two years and possible profit-sharing as the industry recovers.
The western Canadian forestry sector has been on the rebound for the past year as surging demand for lumber in China offset continued weakness in U.S. housing market.
The producers also expect increased lumber and plywood demand as Japan rebuilds from the devastation caused by the earthquake and tsunami. (Reporting by Allan Dowd; editing by Janet Guttsman)