HALIFAX, N.S.–Weak commodity prices, including lingering low prices for oil, are creating declines in exports for energy exporting provinces such as Newfoundland and Labrador and New Brunswick, but higher demand and prices for seafood has mitigated the effect in Nova Scotia and contributed to rising exports from Prince Edward Island, according to a new global export forecast released by Export Development Canada (EDC).
The Global Export Forecast Fall 2015 says energy exports in 2015 will be down 69% in Nova Scotia, 47% in Newfoundland and Labrador and 15% in New Brunswick, but an improvement in oil prices in 2016 will see all three provinces reverse the decline next year. Newfoundland and Labrador – where production levels will return to normal after some longer-than-expected maintenance programs – will enjoy the biggest gain in 2016 at 13%, followed by Nova Scotia and New Brunswick, each of which will raise energy exports by nine percent next year.
“Energy is such a big part of Newfoundland and Labrador’s exports that the steep decline in that sector has really hurt the province’s overall export figures this year,” said Peter Hall, Chief Economist at EDC. “That’s also true for New Brunswick, but the strength of its seafood exports has helped to reduce the overall impact.”
EDC says Newfoundland and Labrador’s exports in 2015 will be down 38% before rebounding to 11% growth in 2016. Exports from New Brunswick will be down five per cent this year but up seven per cent in 2016, while exports from Nova Scotia will decline four per cent in 2015 and then increase by four per cent next year. Only Prince Edward Island, which has no significant energy export sector, will see its exports grow in both 2015 and 2016, up 12% this year and a further six per cent next year.
“Seafood exports have been strong as a result of higher prices, a lower dollar and strong demand, particularly from Asia,” said Hall. “This has really helped P.E.I., Nova Scotia and New Brunswick, all of which are seeing double-digit growth in their agri-food exports this year.”
EDC says the forestry sector in Atlantic Canada continues to benefit from strong demand in the United States for lumber to supply its growing number of housing starts, where Canadian producers enjoy a price advantage due to the weaker Canadian dollar.
Exports by Nova Scotia’s motor vehicles and parts sector and Prince Edward Island’s chemicals and plastics sector are also doing well this year and are forecast to continue to grow in 2016.