Macroeconomic Trends

World

Five years after the beginning of the world economic downturn, a hesitant and uneven recovery is projected over the next two years, with a modest overall global economic expansion expected in 2013, though risks from Europe could slow expansion considerably. The Organization for Economic Co-operation and Development (OECD) predicts 3.4% growth in world real GDP for 2013. ^{Footnote 32}

A recession is ongoing in the Euro area and will remain until well into 2013. The US economy is growing but performance remains below what was expected earlier last year. Uncertainty remains with respect to the potential impact of measures to combat the fiscal challenges faced by the US, which could have a negative impact on economic performance. Asian economies are shifting from output for export to output for domestic consumption. The emerging Asian economies in particular have fairly high savings rates, but their income growth is so strong that they can increase spending by a substantial amount. Spending increases and continued productivity gains will propel these emerging economies. ^{Footnote 33} Inflation had been a concern in several countries, but slightly slower growth has been observed. Latin America has benefited from the global commodities boom, but there is also plenty of domestic consumption fueling economic activity. ^{Footnote 34}

Canada

The Bank of Canada forecasts real GDP growth of 2.3% in 2013, while the OECD Economic Outlook predicts real GDP growth for Canada of 1.8%. Total Canadian exports are expected to continue their recovery from the 2008-09 recession, although they are not expected to reach pre-recession levels until 2014. ^{Footnote 35} Nevertheless, exports of Canadian fish and seafood products increased to $4.1 billion dollars in 2011, exceeding pre-recession levels (i.e. 2008) by 7%. ^{Footnote 36} The total value of seafood exports for the period January-October in 2012 ($3.6B) is keeping pace with the levels observed in the same period of 2011. ^{Footnote 37}

* OECD Economic Outlook, Volume 2012 Issue 2 - No. 92 - © OECD 2012, Statistical annex, Annex Table 1. Real GDP: http://www.oecd.org/eco/economicoutlook.htm
** Average of the exchange rate forecasts of the following Canadian banks: RBC, TD, Scotiabank, BMO, CIBC, BNC.
f: Forecasted
p: Preliminary
Note: The 2012 exchange rate forecasts are a blend of available historical data and the six banks' forecasts for the fourth quarter.

Fuel Costs

Brent crude oil prices fell 14% from USD $110/barrel to USD $95/barrel between May and June 2012, a 16% decline year/year from 2011. Prices then steadily increased through the summer to USD $112/barrel in September 2012 and fell slightly to USD $109/barrel in October 2012. No major disturbances are projected that would affect world oil prices; however the ongoing geopolitical fragility of the Middle East continues to pose challenges in that region. The US Energy Information Administration (EIA) projects that the Brent spot price will fall to USD $103/barrel in 2013, while the Canadian dollar is expected to increase in value in relation to the US dollar, modestly reducing operating costs for fish harvesters.^{Footnote 38} Fuel costs are not incorporated into the model as evidence suggests the supply of species is inelastic with respect to operating costs.