Scotiabank's Commodity Price Index Drops Back In June

  • TransCanada's 'Energy East Pipeline Project' opens up valuable market opportunities for Western Canada's 'oil patch' - both at home & abroad 
  • WTI oil prices climb back to world levels in July, lifting prices in Western Canada
  • China introduces 'mini-stimulus package' to bolster its economy

TORONTO, July 30, 2013 /CNW/ - After rallying in May, Scotiabank's Commodity Price Index fell by 4.1% month-over-month (m/m) in June - the sharpest decline since late 2012.

"The Index will be underpinned in July by a return to stronger oil prices in Western Canada and the beginning of another upswing in lumber and oriented strandboard (OSB) prices, after a sharp, seasonal inventory correction," said Patricia Mohr, Scotiabank's Vice President of Economics and Commodity Market Specialist. "The All Items Index remains 1.7% above a year earlier, with Oil & Gas up +17.8%, Forest Products +1.5% and Agriculture +0.1%  just offsetting a  -13.6% decline in Metals & Minerals."

Highlights in the report include:

  • The advantages of TransCanada's proposed 'Energy East Pipeline Project':  access to less expensive and more secure domestic crude oil, allowing displacement of imports in Quebec and Atlantic Canada; improved financial viability of current refineries as well as the potential for valuable new export outlets for Western Canadian oil - to Europe and, most interestingly, to India.  Refiners in India have shown interest in Alberta bitumen.    
  • After trading well below Brent in late 2012 (-US$21.90 per barrel) and early 2013          (-US$18.27), West Texas Intermediate (WTI) oil prices surged to US$108.05 on July 19, reaching virtual parity with Brent - the international benchmark. This points to stronger prices for Western Canadian Select (WCS) heavy and light oil in Western Canada and improved financial results for producers.
  • China's State Council announced a 'mini-stimulus package,' scrapping taxes on small businesses, reducing administrative costs for exporting companies and creating new financing vehicles for private-sector railway investment (bonds).

Read the full Scotiabank Commodity Price Index at,,3112,00.html.

Scotiabank provides clients with in-depth research into the factors shaping the outlook for Canada and the global economy, including macroeconomic developments, currency and capital market trends, commodity and industry performance, as well as monetary, fiscal and public policy issues.

Scotiabank is a leading multinational financial services provider and Canada's most international bank. With more than 83,000 employees, Scotiabank and its affiliates serve some 19 million customers in more than 55 countries around the world. Scotiabank offers a broad range of products and services including personal, commercial, corporate and investment banking. In December 2012, Scotiabank became the first Canadian bank to be named Global Bank of the Year and Bank of the Year in the Americas by The Banker magazine, a Financial Times publication. With assets of $754 billion (as at April 30, 2013), Scotiabank trades on the Toronto (BNS) and New York Exchanges (BNS). For more information please visit

For high-resolution video clips visit For more Scotiabank economic publications visit,,3112,00.html.

SOURCE: Scotiabank

For further information:

Patricia Mohr, Scotiabank Economics, (416) 866-4210,; or
Devinder Lamsar, Scotiabank Media Communications, (416) 933-1171,


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