Economic Digest – June 2016

SWEDEN

The Swedish Ministry of the Environment and Energy has petitioned the European Union to add the American lobster to a list of foreign species. The crustacean has been found in Swedish waters and the ministry is worried that they may spread disease or result in biodiversity issues, including the co-mingling of species. The release of foreign species of live lobsters into Swedish waters is illegal and it’s unclear how the crustaceans got there. American lobsters were found off the Swedish coast with elastics around their claws bearing the names of North American shipping companies. If the motion before the EU is adopted, it would close the trade of live lobsters between the EU’s 28 member states and North America. This could lose 10 per cent of Canada’s C$75-million export market.

EMERGENCIES

According to Statistics Canada, one in three Canadians have experienced a major emergency or disaster in their community during their lifetime that severely disrupted their daily lives. Blizzards, winter storms or ice storms were the most commonly reported emergency or disaster, experienced by 46 per cent of more than 9-million Canadians. This was followed by extended power outages that lasted 24 hours or longer (36 per cent) and floods (12 per cent).  The most common disruptions  to daily lives experienced by victims of emergencies were an inability to use electrical appliances (63 per cent), missing work or school (61 per cent) or missing an appointment or planned activity, (52 per cent). The most severe disruptions included home evacuation (29 per cent) and an inability to use roads or transportation (28 per cent).

SYRUP

Wild fluctuations in weather patterns are taking a toll on Canada’s production of maple syrup, a quintessential symbol of Canadiana stretching back hundreds of years. The province of Quebec which generates roughly 75 per cent of maple syrup produced in the world has been particularly hard hit. 10-per cent is produced in the rest of Canada and the balance outside of Canada, mainly in the US. The production of syrup was worth C$358-million in 2015, down from $380-million in 2014 and the $408-million peak in 2013. Weather is now the single biggest factor affecting the flow and production of maple syrup.

OIL

American refineries swallowed up cheap and abundant Canadian oil last year helping to  push crude exports to the United States from north of the border to record levels.  Canada sent a record 32.2-million barrels a day of crude oil, up 10 per cent from 2014. US energy imports have dropped over the past decade as technological advancements in the areas of horizontal drilling and fracking means that US oil and natural gas producers can tap previously unreachable resources. US crude oil imports from all sources averaged 7.4-million barrels a day in 2015, down 27 per cent from the 2005 high of 10.1-million barrels per day.

MUSIC

The rise of revenue from streaming services helped reverse almost 20 years of declines in the global music industry last year as digital dollars surpassed physical sales income for the first time. However, nearly 900-million people stream through some free ad-supported services that contribute only 4 per cent of global music revenue. Last year, services such as Spotify and Apple Music helped push the global recorded music industry into significant year-over-year revenue growth for the first time since the Napster-led industry crash. In 2015, worldwide recorded music income rose nearly 3.2 per cent to US$15-billion after flat growth in 2014.

WHEAT

The United States, once the world’s largest wheat exporter is now importing the grain from South America, another indication of how the country is losing its domination of the global trade. US wheat shipments are projected to drop 9.3 per cent this year to 21.1-million tonnes, the lowest since 1972.

TECHNOLOGY

An electronics engineer in Cambridge, England, has developed sensor-filled beans that can be mixed in with the contents of a granary. The beans report continuously on the temperature and humidity, both of which encourage rotting if they are too high, and on carbon-dioxide levels, which reflect the amount of insect breath expelled and thus the level of infestation. At the moment, these things have to be measured, (if they are measured at all) using hand-held instruments that are plunged into the grain pile at regular intervals by farm hands.  The beans themselves are plastic shells 45mm long and 18mm wide, manufactured by 3D printing.  A bean also contains an electronic compass and gyroscope that, acting together senses its orientation.  All of these devices are powered by a wirelessly rechargeable battery.

TOURISM

Canada’s biggest sources of tourism in 2015 as measured by overnight stays were the United States with 12,474,500 visitors. Next were 715,548 visitors from the United Kingdom and France 500,502. Next was China with 493,827 visitors, Germany with 328,870, Australia, 286,906 and Japan, 275,027 tourists. The strengthening US economy and low Canadian dollar offered an advantage for Canada’s tourism industry; however, the exchange rate means the tourism marketing industry gets less bang for its buck.

SHIPS

There are bargains to be found if you are looking for a ship that can carry 180,000 tonnes of iron ore.  It’s a buyer’s market for the massive vessels as cash-strapped ship-owners reduce their fleets amid a plunge in demand. The large ships just five years old are selling for US$22-million compared with $180-million just before the financial crisis of 2008. Since September of last year, 263 second-hand bulk commodity ships worth a total of $3-billion have been sold.  Owners, facing near-record low charter rates are being pressed by their lenders to liquidate a fleet that is too large for the market. Greeks have been the biggest buyers on the second-hand market spending $1.3-billion since last September on 95 ships.

VISAS

One of the most difficult green cards to get has been a visa for China. Since 2004 only about 800 have been issued each year.  Demand for permanent residence has never been overwhelming as smoggy skies and rising pressure on foreign business sends workers and companies to better air and opportunities elsewhere. Now, however, as China’s economy slows, it is pledging to make its green cards easier to get, conferring on foreigners rights to invest, own property and use social services. As part of a strategy to lure people in and ideas, authorities across the country have been told to loosen work restrictions on foreign students, create opportunities for investor immigrants and ease green card acceptance for entrepreneurs and scientists. In percentage terms, China today remains near the bottom of the world for number of foreigners living inside its borders.

LAMPREYS

They are a snake-like creature, long regarded as a royal delicacy and said to have been responsible for the death of King Henry I who ate too many of them. Now they are staging a resurgence in English rivers where they have not been seen since the 1800s. They were virtually wiped out in English rivers as a result of pollution and the construction of weirs and other obstacles that prevented them reaching their spawning grounds upstream.  Lampreys are the world’s oldest living vertebrates, having been in existence some 200-million years before the dinosaurs. Sea lampreys, the biggest of the lamprey species in the UK, can grow up to a metre in length.

VEGGIES

Canadian farmers are cashing in on the highest vegetable prices in years, helped by the country’s weak currency soaring costs of US imports. Soft wheat and canola prices may diminish Canadian farms incomes by 9 per cent this year but it is the best of times for carrot and beet growers, part of a niche industry best known for stocking farmers markets. 20 acres of beets can bring 10 times more net profit than canola. Vegetable plantings in Saskatchewan are expected to grow by 10 per cent this year and some farmers of tomatoes and cucumbers are expecting the best prices in 15 years.

AFRICA

China’s economic slowdown is being felt throughout Africa as the global commodities collapse chokes investment and growth. Led by South Africa the continent spent years forging trading ties with the Asian economic powerhouse, only to now find itself highly exposed to a downturn it can do little to stop.  Africa’s exports to China decreased 38 per cent last year while overall Africa-China trade fell 18 per cent, the lowest level in four years. At the same time, Chinese investment in Africa declined 40 per cent.  It was the Chinese commodity demand that helped open up the African frontier for Canadian mining companies and energy sector suppliers, both of which are now in a steep downturn.

WAGES

The average wage across Canada declined last year, with pay in resource-rich Saskatchewan and Newfoundland and Labrador dropping the most.  The average hourly pay in the country eased 3 per cent to C$18.45 in the first three months of 2015. In oil-centric Alberta pay eased 5 per cent to $18.90. British Colombia, which has a healthier economy, saw average earnings fall to $17.65. Nationally, earnings dropped in manufacturing, transportation trades and sales. Alberta’s jobless rate is now 7.4 per cent, higher than the national rate for the first time in nearly three decades.

MOVIES

The cinema business is healthy. Revenue from the American box office grew by 6.3 per cent to a record high of US$11-billion. Thanks to droves of new filmgoers in China, where the market grew by 49 per cent, global revenues increased by 4 per cent to $38-billion. The industry has held up well against increased competition from streaming services that give people plenty of options to watch films at home. Much of the industry’s recent success at home and abroad comes from the rise of the big special-effects films. A group of 14 films made more than $500-million each in worldwide takings last year, up from just five such films in 2006.

THIRST

China is such a vast market, it quickly becomes the largest market for almost anything it consumes. Such is the case with bottled water.  Chinese drink 40-billion litres each year, up over 13-fold since 1998. That growth has a long way to go if China ever consumes as much per person as Mexico (175 litres per person annually), or Italy (150 litres per person per year). But finding clean supplies in China is difficult; rivers, lakes and even groundwater in China are often foul. Now, thanks to a massive investment in infrastructure, it is being sourced from Tibetan glaciers.

RICKETS

The earliest known case of rickets in the UK has been identified in a 5,000-year-old skeleton .found in Scotland.  The disease, caused by Vitamin D deficiency linked to a lack of sunlight, can lead to weak and deformed bones. It was identified in the remains of a Neolithic woman who had been buried on the Scottish island of Tiree. Until now, the earliest case of rickets in Britain dated to the Roman period. According to scientists, there have been a few possible cases in other parts of the world that are around the same time, but none as clear cut as this.

TREES

According to a new assessment, there are just over three-trillion trees on earth. The figure is eight times as big as the previous best estimate which counted perhaps 400-million at best. It has been produced by scientists at Yale University who combined a mass of ground survey data with satellite pictures. The new total represents upwards of 420 trees for every person on the planet. The more refined number will now form a baseline for a wide range of applications, everything from studies that consider animal and plant habitats for biodiversity reasons, to new models of the climate, because it is trees that play an important role in removing the greenhouse gas carbon dioxide from the atmosphere.

FLYERS

The lowly print flyer is far from dead in the digital age. Even as online technology has delivered a blow to the music, movie, magazine and other industries, it has yet to significantly disrupt the printed flyer business. Many major retailers keep printing the advertising pamphlets in significant numbers, while at the same time producing digital flyers. Executives from Canadian Tire, London Drugs and home furnishing specialist IKEA are confident that printed flyers will still be around in 10 years.

THRIFT

A man in England was shocked to find his train from Sheffield to Essex (about 50 miles) cost about US$100. So he went an extra 1,017 miles and flew via Berlin, Germany for less and had enough money left over for a sandwich in Germany.