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Trade

Topic Box from the 2011 Final Benchmark Report

Relative weakness in BC’s export sector is mainly due to a decline in shipments of lumber and pulp and paper to international markets.

Although its share of exports is well below that of the 1990s, the forest industry still generates three of every ten dollars in export income in BC.

The share of export income from shipping forestry products abroad means BC will not see strong export growth in the near term without selling more timber and pulp. Fortunately, this has been happening since 2009 and appears likely to continue.

The 2009 benchmark report included two topic boxes focused on trade (“Trade with China” and “Export Detail”) to explain BC’s performance. The central messages that BC’s export performance is driven by international forestry exports and that trade with China is a bright spot were true in 2010 and hold for this year as well.

Commodity exports to China grew quickly to just under ten percent of BC’s total in 2009, to 14 percent in 2010 and are on track to account for even more in 2011 and 2012.

Export Development Canada forecasts BC’s exports to grow by 17 percent in 2011 and by 13 percent in 2012, a rate almost double that for the country as a whole.

The Export Development Canada forecast notes that forestry, energy and industrial goods are expected to perform particularly well and that high prices for many of British Columbia’s key commodities (including pulp, coal and copper) will support expansion.

Overall, continued strong demand from Asia and positive signs of housing recovery in the United States bode well for BC’s export performance.

Sources

BC Stats, Exports: September 2011, (2011); Exports (B.C. Origin): 2001-2010, (2011); Export Development Canada, Animal Spirits and The Economy: Global Export Forecast.