Nova Scotia exports to lead the country in 2011: EDC
HALIFAX: Nova Scotia’s international exports will rebound strongly this year and outperform all other provinces in 2011, says a provincial export forecast.
The Export Development Canada (EDC) says the province’s exports contracted by 26% last year but will grow 12% this year and 17% in 2011.
“Nova Scotias’ strong performance is based on improved demand from the US, which translates into a broad-based rebound of [the province’s] main export sectors including natural gas, fish, tires, and newsprint,” said Peter Hall, EDC’s chief economist. “Natural gas exports, in particular, will drive the province’s exceptional export growth in 2011.”
The agrifood sector, which accounts for 24% of total exports and the province’s largest export sector, will grow by 2% in 2010 and 8% in 2011. Hall says EDC does not anticipate a dramatic rebound in prices for lobster or crab, but ground fish, herring and shrimp stocks have remained stable and crab has increased. Combined with positive regulatory developments, he says fish exports are well placed for a modest recovery through 2011.
Motor vehicles, the second largest export sector will grow by 13% this year and 7% in 2011.
“An increase in US vehicle sales to around 11.4 million units in 2010 will boost OEM production south of the border,” said Hall. “Higher sales activity, together with low inventory levels, will drive demand for Nova Scotian tire exports over the next two years. As a result, we expect the Michelin plant should operate at full capacity starting this year.”
The energy sector continues to grow in Nova Scotia, accounting for 15% of the province’s total. EDC expects the sector to grow by 21% and 57% in 2010 and 2011, respectively.
“A partial recovery in natural gas prices will be more than enough to offset the decline in production volumes from the Sable project this year,” Hall said. “Next year, a positive price environment coupled with the coming online of the Deep Panuke offshore project will push exports up significantly.”
Another positive is the start of production at the Donkin coal mine in 2012. He said the mine has both thermal and coking coal resources that, once extracted, will primarily be shipped overseas.
Canadian exports are forecast to rise 11% in 2010 and 7.6% in 2011. Nationally, economic growth is expected to rise 2.5% in 2010 and 2.9% in 2011. Internationally, EDC is forecasting global growth of 3.7% in 2010 and 4.2 per cent in 2011.
Click here for EDC’s Global Export Forecast.