China To Stay Hungry For Canadian Oil, Metals, Says BoC Report

"In terms of commodity imports, China's economic and trade developments appear to have grown much faster than expected, causing a larger-than-anticipated increase in global demand for oil and metals," the report says. "Together, these two effects help to explain the recent change in the relative prices of these goods." Canada's economy has ridden the wave of global commodity prices since 2002, when the Canadian dollar began its move from under 70 cents US to parity with the greenback. But while the loonie's flight has been welcomed by many Canadians, it has also caused havoc in Canada's manufacturing sector by increasing the relative cost of production and price of exported goods, resulting in plant closures, slowdowns and the layoff of about 300,000 workers since 2002. The Commons finance committee completed its third day of hearings on the impact of the strong dollar Thursday, with more witnesses attesting to its devastating effect. Listing off a serious of problems besetting the forestry industry, including low demand in the U.S., Avrim Lazar of the Forestry Products Association of Canada did not hesitate to name the worst. "The dollar is by far the worst of all our problems," he told the committee Thursday. But Lazar also noted the sector views China and Asia as a whole as an opportunity, saying that as more people in that region move from poverty to the middle class, they will want forest products "to blow their nose, read the newspaper, wrap their presents, and we are very well positioned" to meet that demand. http://www.winnipegfreepress.com/subscriber/business/story/4082093p-4681572c.html

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