FREDERICTON, May 28 /CNW Telbec/ - New Brunswick's exports are expected to increase by 18 per cent in 2010, the best in the country, and another 8 per cent in 2011 according to a provincial export forecast released today by Export Development Canada (EDC). New Brunswick's exports dropped by 22 per cent in 2009.
"Powered by higher energy prices and the first full year of production at the LNG regasification plant, exports out of New Brunswick should post the most sizable gains in Canada this year," said Peter Hall, Chief Economist of EDC, during speeches today in Moncton and Fredericton.
"New Brunswick's exports will also benefit from positive developments in potash exports and better fundamentals for the pulp and wood products segments. Next year's growth will come from various sectors, including energy, agrifood, forestry and industrial goods."
The province's energy sector accounts for 65 per cent of the province's total exports, and EDC forecasts the sector to grow by 23 per cent and 8 per cent in 2010 and 2011, respectively.
"The province's energy exports will get a significant jolt in 2010 and 2011, as production ramps up at the Saint John LNG regasification plant," Mr. Hall said. "The increases will also be supported by our forecasted higher prices for energy through 2011, as the price of crude jumps from an average of USD61/br in 2009 to USD69 in 2010 and USD72 in 2011."
"Natural gas prices should rise to USD5.60 per MMBtu in 2010 and USD6.10/MMBtu in 2011, from USD3.95 in 2009. Despite the cancellation of the planned second refinery in Saint John, the long-term outlook for the province's energy exports is still very favorable, thanks to extensive shale gas exploration activity."
The forestry sector represents 12.7 per cent of the province's total exports, and EDC forecasts the sector to rebound by 24 per cent in 2010, followed by another 9 per cent in 2011.
"Exports from the forestry sector will also see strong growth this year, as a result of higher prices for various commodities and better demand prospects", said Mr. Hall. "Of the main sub-sectors, pulp exports will record the largest increase in 2010, with pulp prices advancing firmly. Some capacity expansion is still in the cards for AV Cell and AV Nackawic in 2012, which would lead to temporary shutdowns next year for the upgrades."
"With the province now out of the newsprint business, paper exports will outperform the national average this year and next, improving on better US demand. In addition, New England's housing sector is relatively better off than the US average, positioning New Brunswick wood product exporters to outshine the rest of Canada."
The third largest export sector in New Brunswick is agrifood, accounting for 11 per cent of the province's total. EDC's forecast calls for a decline of 3 per cent in 2010 before rebounding by 8 per cent in 2011.
"Driving the 2010 decline are expected lower prices for lobsters, which could lead to fewer landings," said Mr. Hall. "We expect the declining trend in snow crab quotas to continue this year. Salmon prices should continue to gain from the ongoing problems in Chilean stocks, but there is limited capacity in the Bay of Fundy to expand production."
EDC expect that potatoes will have a very difficult year in 2010, as over-planting in the U.S. last year drove down prices while french fry demand from fast-food outlets remains depressed. Exports of agrifood products are forecast to bounce back next year as shellfish and potato prices pick up, and Ocean Spray begins harvesting cranberry at its bog in Rogersville (although full production is not expected until 2012).
Canadian exports are forecast to rise 11 per cent in 2010 and 7.6 per cent in 2011. Nationally, economic growth is expected to rise 2.5 per cent in 2010 and 2.9 per cent in 2011. Internationally, EDC is forecasting global growth of 3.7 per cent in 2010 and 4.2 per cent in 2011. EDC's Global Export Forecast is available at http://www.edc.ca/gef.
EDC is Canada's export credit agency, offering innovative commercial solutions to help Canadian exporters and investors expand their international business. EDC's knowledge and partnerships are used by more than 8,400 Canadian companies and their global customers in up to 200 markets worldwide each year. EDC is financially self-sustaining, a recognized leader in financial reporting and economic analysis, and has been recognized as one of Canada's Top 100 Employers for nine consecutive years.
SOURCE Export Development Canada
For further information: For further information: Media contacts: Phil Taylor, Export Development Canada, Tel: (613) 598-2904, Blackberry: email@example.com