A one-two punch for N.B.

With the Washington, D.C.-based National Association of Homebuilders predicting a 24% increase in housing starts in the U.S. for 2014, this will benefit New Brunswick’s wood-processing industry, says Fred Bergman, senior policy analyst with the Atlantic Provinces Economic Council (APEC) in Halifax, which is forecasting real GDP growth of 0.9% for New Brunswick.

Another boost for manufacturers and their ability to compete is the declining value of the loonie, says Jonathan Bendiner, regional economist with Toronto-Dominion Bank (TD) in Toronto.

TD is predicting GDP growth of 1.3% for New Brunswick, and also forecasting the dollar’s further decline to approximately US90¢ by late 2014 and into the high US80¢ range in 2015.

Another positive factor in this export story is the return to full-capacity production for the Point Lepreau generating station located on the shores of the Bay of Fundy. It was being refurbished between 2008 and 2012 but became fully operational only this past November. The refurbished plant, says Bergman, helped the province’s energy exports jump by 128% year-to-date to November.

Meanwhile, the outlook for the province’s potash sector is mixed. Weakness in global potash demand led Saskatoon-based Potash Corp. of Saskatchewan Inc. (PotashCorp) to announce it is reducing its workforce this year. New Brunswick will lose 130 jobs and a mine in Penobsquis, which is close to Sussex.

Approximately 400 of that mine’s workers will transfer to PotashCorp’s expanded Picadilly mine, which is also near Sussex, according to Bill Johnson, senior director of public affairs for PotashCorp. The Picadilly site will open at the end of this year.

New Brunswick is also heading into a year in which major capital investment projects are few. It seems the only sure bet is Oxford Frozen Foods Ltd.’s $184-million investment to build a processing facility for its blueberry operations, with construction planned to begin this spring.

However, it’s a waiting game for projects such as the Sisson tungsten/molybdenum mine and Calgary-based TransCanada Corp.’s Energy East pipeline.

The Sisson mine, which is worth $579 million and is being developed by Vancouver-based Northcliff Resources Ltd., is currently in the environmental impact assessment stage, says Bendiner: “The thinking is that if the assessment is approved, the construction phase can begin this year.”

As for the pipeline, which will stretch from Alberta to New Brunswick, TransCanada will be applying for approval to the National Energy Board this year. It’s estimated that New Brunswick will receive about $2.2 billion in capital spending, according to a Deloitte & Touche LLP report commissioned by TransCanada.

New Brunswickers are heading to the polls this year, and the provincial government is in need of those capital dollars, anticipating a deficit of $538 million in fiscal 2013-14, ending March 31; furthermore, Statistics Canada reported a yearend unemployment rate of 9.7% in the province.

The deficit has increased since the end of the previous fiscal year, although the government has successfully reduced spending. The increasing deficit is due to a revenue shortfall of $173 million.

New Brunswick

Population: 756,050

GDP 2012 ($bil.): 31.5

GDP % change: +0.8

2013-14 deficit ($mil.): 538

Estimated net debt ($bil.): 11

Median after-tax income, all families: $44,900

Household disposable income/capita: $26,793

Figures are from latest available reports/estimates

Sources: conference board of Canada;

Government reports

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