Energy and fertilizer sectors set to bounce back in 2017
Saskatchewan’s export situation will improve dramatically from this year to next, according to Export Development Canada’s (EDC) semi-annual Global Export Forecast. Continued challenges in the energy and fertilizer sectors will cause the province’s overall exports to shrink by three per cent this year, but growth returns in force in 2017 to the tune of eight per cent, thanks to partial recovery in the energy sector and a strong performance by the agri-food sector.
Once again, Saskatchewan is Canada’s leading province when it comes to agri-food exports. EDC forecasts that the sector, which accounts for nearly half of the province’s exports, will grow by three per cent this year, and six per cent in 2017.
“Saskatchewan’s oil seeds and pulses exports will remain very strong over the next two years due to a lower Canadian dollar, higher prices, and continued demand from emerging markets,” said Peter Hall, EDC’s Chief Economist.
“China and India both have a rapidly-growing middle class with consumers that are hungry for the world-class quality of Saskatchewan’s agri-food products. We’re starting to see the impact of that demand now, but in our view this is only the tip of the iceberg.”
Energy sector exports are expected to grow by 19 per cent in 2017, rebounding from a 17 per cent drop-off this year. Accounting for almost one-quarter of the province’s exports, the energy sector is having a significant negative impact on the province’s overall export forecast in 2016. An about-face in the sector next year will likewise help to drive overall exports back to healthy growth levels.
Similar trends will be seen in the province’s fertilizer sector, which accounts for roughly three-quarters of Canada’s international fertilizer shipments. Saskatchewan’s potash exports will feel the impact of declining prices and global over-supply, declining five per cent this year, but managing three per cent growth in 2017.
“There was no avoiding what happened with energy last year and the further impact that decline is having this year, but better times are on the horizon for Saskatchewan exports,” said Hall. “We think that now is the time for Saskatchewan exporters to plan for and capitalize on global opportunities. Growth is coming, it’s a matter of being well-positioned when it arrives.”
Mr. Hall is discussing Saskatchewan’s export prospects – and those of the rest of Canada – with local business people today at the Radisson Hotel in Saskatoon. The event is being held in partnership with the Saskatchewan Trade & Export Partnership (STEP).
Over the next month, Hall will travel across Canada for EDC’s Let’s Talk Exports tour, which offers insights on the current global economy and explores how economic trends will impact Canadian exporters.
Visit EDC’s Global Export Forecast: Spring 2016 to learn more.
Export Development Canada (EDC) is a financial Crown corporation dedicated to helping Canadian businesses make an impact at home and abroad. EDC has the financial products and knowledge Canadian companies need to confidently enter new markets, reduce financial risk and grow their business as they go from local to global. Together, EDC and Canadian companies are building a more prosperous, stronger and sustainable economy for all Canadians.
For more information and to learn how we can help your company, call us at 1-800-229-0575 or visit www.edc.ca.