(Montreal) – November 27, 2014
Key sectors like forestry, metals, and aerospace will drive Quebec’s strong export growth of 8 per cent this year, and add another 9 per cent gain in 2015, according Export Development Canada’s (EDC) recent economic forecast.
Forestry is the biggest mover this year, as strong housing demand in the US and a weak Canadian dollar are driving a sky-high 15 per cent increase in exports. Lumber is the strong performer within the sector, while pulp and paper continues its decline as newsprint and other paper products are phased out in favor of digital alternatives.
“There is tremendous pent up demand right now in the US, especially in the housing sector, which bodes well for Quebec lumber,” said Peter Hall, Chief Economist, EDC. “Builders are not keeping pace with rising demand, so every day the US is adding to its sizable housing deficit. It will take a lot of wood to help them climb out of that hole, so Quebec’s abundant supplies and a cheaper Canadian dollar are positioning the province to cash in on the bonanza.”
Forestry will continue its solid performance into 2015, with 9 per cent export growth, but will be overtaken by the metals and ores sector which is projected to see 10 per cent growth next year.
Metals and ores account for the largest share of Quebec’s exports, at 26 per cent. Aluminum is the main engine behind the expected surge next year, thanks to increased output in 2014 and 2015 from smelters, and higher demand in the US.
“We expect aluminum to champion this sector in the coming years, in part because of its increased use in automobiles. Just this year we saw Ford introduce an all-aluminum-body pickup truck, a very encouraging development for Quebec smelters,” said Hall.
“And while it might not factor into our forecast for 2014-2015, Quebec’s re-launch of the ‘Plan Nord’ will likely have a positive impact on the metals and ores sector in the near future, as new mining projects in Quebec’s northern reaches come online."
The Aerospace sector will also see 10 per cent growth in exports next year, again fuelled by the weak Canadian dollar and steady international demand. Other factors contributing to this growth are improved private sector financing conditions in developed economies, increasing demand from emerging economies like Indonesia and China, and carriers looking to upgrade to more efficient fleets to combat high jet fuel prices.
“Quebec is a major beneficiary of these positive international trends, and with Bombardier’s CSeries expected to enter into service in late 2015, it will be a huge boon for Quebec’s aerospace industry for years to come,” said Hall.
EDC’s semi-annual Global Export Forecast addresses the latest global export conditions including market- and sector-specific insights to help Canadian exporting companies grow their international sales. It also analyzes a range of risks for which exporters should be prepared. Read EDC’s Global Export Forecast.
EDC is Canada’s export credit agency, providing financing and insurance solutions locally and around the world to help Canadian companies of any size respond to international business opportunities. As a profitable Crown corporation that operates on commercial principles, EDC works together with private- and public- sector financial institutions to create greater capacity for Canadian companies to engage in trade and investment.
For more information about how EDC can help your company, call us at 1-888-434-8508 or visit www.edc.ca.
-30-
Phil Taylor
Export Development Canada
(613) 598-2904
ptaylor@edc.ca
