(FREDERICTON) May 28, 2007 New Brunswick's international exports are forecast to decline by 6 per cent in 2007 before leveling off in 2008, according to a provincial export outlook by Export Development Canada (EDC). This year's decline reflects falling exports of energy and forestry products, accounting for 58 per cent and 19 per cent of New Brunswick's exports, respectively.
"As the price of oil is expected to ease back through 2008, the province's energy dependent exports will follow that downward trend," said Stephen Poloz, Senior Vice-President of Corporate Affairs and Chief Economist. "With a further decline in energy prices on the horizon, energy exports are expected to fall 9 per cent in 2007 but remain flat in 2008 as production at the Irving LNG terminal begins and greater natural gas exports offset further declines in refined petroleum products."
As Canada's most export-intensive province (as a share of GDP), New Brunswick's non-energy exports are being affected by the higher Canadian dollar and dwindling demand for wood products amid a weak US housing market Producers have responded to slowing demand by curtailing production at a number of NB mills, including at Saint-Léonard, Kedgwick, Plaster Rock and, more recently, Miramichi. Exports of wood products declined 21 per cent in 2006, coming off an 11 per cent drop in 2005. With the prospect of weak fundamentals for lumber demand in 2007, EDC is forecasting a 6 per cent decline in exports of wood products in 2007 before growing by 5 per cent in 2008. Exports of pulp are expected to increase 8 per cent in 2007 and another 4 per cent in 2008. With softer prices for most paper products expected this year, exports in this sub sector are forecast to fall by 4 per cent in 2007 and by another 2 per cent in 2008.
Despite greater exports of farmed salmon and much improved potato prices, exports of agriculture and fishing products were down 5.5 per cent in 2006. Exports of fishing products alone declined 11% in 2006. The drop was largely the result of generally weaker prices and a smaller crab quota. Despite a slightly improved international outlook for potatoes, fish and seafood products in 2007, exports of agriculture and fishing products are expected to remain flat in 2007 and weaken slightly in 2008.
Nationally, Canadian export volumes are forecast to decline by 1 per cent in 2007 before rising by a modest 1 per cent in 2008. Canadian economic growth is forecast to remain stable at 2.3 per cent in 2007 and 2.9 per cent in 2008. Internationally, EDC is forecasting 4.5 per cent global economic growth in 2007 and 4.6 per cent growth in 2008. EDC's Global Export Forecast is available at http://www.edc.ca/gef.
Export Development Canada 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 7,000 Canadian companies and their global customers in up to 200 markets worldwide each year. EDC is financially self-sustaining and is a recognized leader in financial reporting, economic analysis and has been named one of Canada's Top 100 Employers for six consecutive years.
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Media contact:
Phil TaylorEDC Public Affairs(613) 598-2904 ptaylor@edc.ca
