May 2014 Edition
FRUIT
Bananas are now the world’s most valuable fruit. Exports rose from 11.9-million tonnes in 2001 to 16.5-million tonnes in 2012. Americans eat more bananas than apples and oranges together. But the export industry is fighting to survive on two fronts. First Black Sigatoka, a disease which blackens leaves and can halve yields is showing resistance to the fungicide used to combat it. Second, Foc Tropical Race 4, a strain of disease that attacks the Cavendish banana, a variety that accounts for 95 per cent of the exports of all bananas, has struck in several countries. Central and South America which produce four-fifths of exports have so far escaped, but it is just a matter of time.
CREDIT
Canada has become a creditor nation. For the first time in at least nine decades, Canada has more assets abroad than foreigners have here. Statistics Canada recently reported that the country had net assets of C26.7-billion, up from a net liability position of $302.1-billion at the end of 2012. The reason for the dramatic turnaround is a combination of strong foreign stock market gains in the US and elsewhere, coupled with a roughly 10 per cent decline in the Canadian dollar. The result was a 21 per cent gain in the value of foreign assets, which outpaced a 7 per cent increase in liabilities.
BONUSES
The bonus pool for people employed in the securities industry in New York City increased by 15 per cent in 2013, to US$26.7-billion. The average bonus paid also rose by 15 per cent to $164,530. This was the third highest average bonus on record and the biggest since the 2008 financial crisis. The industry has been profitable for five consecutive years, but the number of jobs, estimated to be 165,000, is still 12.6 per cent below the crisis level.
SIZE
Homes in the United States are getting bigger again. In 2008, the median size of a new home built for sale in square feet was 2,266. In 2010 that figure had dropped to 2,210. In 2011 it had risen to 2,327 and in 2012, it was 2,384.
TRUFFLES
Identifying agricultural areas where truffles will grow is often hit and miss. A Washington company is analyzing data about places where they grow successfully using 11 variables, including geology and altitude, to create maps where the fungi should grow well. Some Oregon truffles are fetching about US$400 a pound at the moment, but this is still about half the cost of some Italian and French ones. Attempts to grow truffles commercially are now being tried in Chile, China and New Zealand.
DRONES
Military drones already fly frequent missions and civilian operations using unmanned aircraft are coming. Ships, like aircraft are increasingly controlled by electronic systems, which makes automation easier. Now the maritime industry is interested in crewless ships for two reasons. The first is safety as most accidents at sea are the result of human error, just as they are in cars and planes. The second reason of course is cost as it is getting harder and harder to sign up competent crews prepared to spend months away at sea. Moreover, some voyages are likely to get even longer for ships with non-urgent cargo as a 30 per cent reduction in speed by a bulk carrier can save around 50 per cent in fuel.
BIRDS
Aircraft strikes by birds are a problem, sometimes a fatal one, for military and civilian aviation alike. America’s Federal Aviation Administration (FAA) reports there are about 10,000 strikes a year to the country’s non-military aircraft costing more than US$957-million in damage and delays. The worldwide figure reported by the European Space Agency is $1.2-billion. Bird strikes have been responsible for 242 deaths between 1912 and 2004. In some countries, radar is being used by air forces to prevent bird strikes by tracking birds that may threaten aircraft. In one, the Israeli air force has reduced the number of strikes it suffers by two-thirds.
BRAZIL
Coffee prices have risen by over 45 per cent so far this year, as severe drought in Brazil combined with leaf rust across Central America has damaged crops. Analysts reckon that this year’s crop will be some 10 per cent smaller than last years. The scarce rain and heatwave have also driven sugar prices to a three-month high. Brazil is the world’s largest producer of both commodities, as well as soyabeans, which are getting more expensive.
TUK-TUKS
They are most commonly associated with the teeming cities of developing Asia, but three-wheeled motorised rickshaws, or tuk- tuks, first emerged in Japan and Italy just over half a century ago. Since then the compact, cheap and adaptable vehicles have spread to every corner of the globe. Bangladesh, Egypt, India, Nigeria, Peru, Sri Lanka and Thailand are now the biggest markets. They are increasingly seen chugging through the streets in east Africa, the Middle East and China. India is the biggest producer, turning out more than 530,000 tuk-tuks a year for the local market and a further 300,000 for export. Some models now run on compressed natural gas rather than diesel and an Australian firm is developing a solar one.
TOMATOES
Developed in Britain, large scale production is now under way of genetically modified purple tomatoes. The pigment, known as anthocyanin, is intended to give tomatoes the same potential health benefits as fruit such as blueberries. Anthocyanin is an anti oxidant which studies on animals show could help fight cancer. Scientists say the new tomatoes could improve the nutritional value of everything from ketchup to pizza topping.
CHARGERS
European politicians have backed a regulation that will force smartphone makers to use just one type of charger. The regulation was drawn to help consumers and to cut down on the amount of electronic waste. It is expected to cut down on electronic clutter and 51,000 tonnes of electronic waste annually.
MEAT
As consumers further tailor their diets to the latest health and wellness trends, 39 per cent of red meat-eaters report consuming less in 2013 than they did in 2012 although 90 per cent say they eat at least some kind of red meat at least once per month. Health trends motivating consumers to cut fat and cholesterol intake are by far the most dominant factors affecting the red meat market. Price is also a factor as 58 per cent of consumers surveyed reported that they have noticed the price of red meat has increased in the past 12 months.
BEER
The market share of craft beer in British Colombia has doubled in four years and shows no sign of slowing. The share was nine per cent of all beers in 2009 and has risen to 19 per cent in 2013. Large breweries’ beer sales declined nearly four per cent last year while sales by microbrewers increased 38 per cent. Last year there were 10 brewery openings and there are at least 21 new breweries in the planning stages for this year, 13 of those in Metro Vancouver.
CARP
The US city of Chicago is considering drastic measures to prevent giant fish infesting North America’s Great Lakes. Authorities are thinking of blocking the city’s canal system to stop Asian carp entering Lake Michigan. Such a move could cost up to US$18-billion and cause huge economic disruption to the city. The species of carp is native to the far East and was originally introduced to southern US states more than three decades ago to control algae build-up in sewage treatment plants. But they escaped into the Mississippi River and proliferated, making their way north towards the Great Lakes.
JOBS
News of job losses in Canada are overshadowing a bright spot in Canada’s labour market. The professional, scientific and technical services sector, which tends to pay above-average wages, hit its highest job level on record last December. This sector led the country’s job growth last year with an increase of 85,000 jobs. It is now the fourth-largest sector by employment in Canada, with more workers than in construction. This sector includes accountants, engineers, architects, lawyers, research and development specialists, surveyors, consultants, graphic designers and marketers. Its share of total employment has climbed to 7.6 per cent from 4.9 per cent two decades ago.
SHIPPING
Insuring the giant ships that traverse the Arctic and Northern Canadian waters is a growing business but one that deals with a great deal of uncertainty. Warmer weather has opened waterways that used to be clogged with ice, but much of Canada’s Arctic territory is uncharted and the capacity to rescue ships in trouble is limited. Governments are concerned about possible pollution from spills of fuel or cargo. On top of that, insurers have limited claims data on which to base underwriting claims.
LIVESTOCK
Canadian farmers reported 12.2-million cattle on their farms at the start of the year, down 0.7 per cent from a year. 82,665 farms reported cattle and calves,1.4-million of which were dairy cows and heifers. Hog producers reported 12.7-million hogs a 1.1 per cent increase, while the number of sheep fell 1.0 per cent to 893,000 head. Canada exported 5.0-million hogs last year, down 12.4 per cent from 2012 and 50 per cent less than the peak in 2007. There were 7,090 hog farms in Canada as of January 1st, 2014.
PARKS
Visitors to national parks in the USA play a pivotal role in boosting nearby economies and supporting jobs throughout the country. A recent report by the Park Service and the US Department of Interior found that about 280-million park visitors helped generate nearly US$27-billion in economic activity and supported 243,000 jobs in 2012. Of those numbers, $14.7-billion was spent in “gateway regions” , or communities within a 60-mile radius of a park, supporting more than 200,000 jobs in those communities. For instance, more than 1.3-million visitors to Joshua Tree National Park in California, helped contribute about $62-million to nearby communities and supported 770 jobs. The Grand Canyon attracted 4.4-million visitors, contributed about $453-million and supported 6,000 jobs.
GOLD
China is poised to become the world’s biggest gold buyer that could support prices of the precious metal as well as accelerate the global bullion market’s shift eastward. Gold purchases by Chinese consumers jumped 41 per cent this past year. China has long had a cultural affinity for precious metals and the increasing affluence of consumers there, along with more relaxed investment restrictions has boosted the country’s demand for gold bars and jewelry alike. The increase was enough to overtake India which for decades, if not centuries, held the No. 1 spot. The price of gold declined 28 per cent in 2013, the biggest drop in 32 years as money managers dumped gold and bought stocks.
POP
The two major manufacturers of soft drink in North America are being forced to find other sources of revenue as their sales decline. The soda makers are struggling with reduced North American demand for their core carbonated drinks and counting more on other products to diversify and bring back customers. In this troubled sector, soft-drink makers are grappling with their products being heavily discounted on store shelves as retailers try to lure consumers who have turned to healthier or trendier products.
COMMUNICATIONS
A burglar in Britain took a photograph of himself with a stolen smartphone while on the job and inadvertently sent it to the authorities. He is now in jail.
Thank you for reading the A & A Economic News Digest. For more information visit our website www.aacb.com or contact A & A Contract Customs Brokers Ltd. at strehler@aacb.com.
Past issues of the A&A Economic News Digest can be found at http://www.aacb.com/publications/ed/index.asp
Bananas are now the world’s most valuable fruit. Exports rose from 11.9-million tonnes in 2001 to 16.5-million tonnes in 2012. Americans eat more bananas than apples and oranges together. But the export industry is fighting to survive on two fronts. First Black Sigatoka, a disease which blackens leaves and can halve yields is showing resistance to the fungicide used to combat it. Second, Foc Tropical Race 4, a strain of disease that attacks the Cavendish banana, a variety that accounts for 95 per cent of the exports of all bananas, has struck in several countries. Central and South America which produce four-fifths of exports have so far escaped, but it is just a matter of time.
CREDIT
Canada has become a creditor nation. For the first time in at least nine decades, Canada has more assets abroad than foreigners have here. Statistics Canada recently reported that the country had net assets of C26.7-billion, up from a net liability position of $302.1-billion at the end of 2012. The reason for the dramatic turnaround is a combination of strong foreign stock market gains in the US and elsewhere, coupled with a roughly 10 per cent decline in the Canadian dollar. The result was a 21 per cent gain in the value of foreign assets, which outpaced a 7 per cent increase in liabilities.
BONUSES
The bonus pool for people employed in the securities industry in New York City increased by 15 per cent in 2013, to US$26.7-billion. The average bonus paid also rose by 15 per cent to $164,530. This was the third highest average bonus on record and the biggest since the 2008 financial crisis. The industry has been profitable for five consecutive years, but the number of jobs, estimated to be 165,000, is still 12.6 per cent below the crisis level.
SIZE
Homes in the United States are getting bigger again. In 2008, the median size of a new home built for sale in square feet was 2,266. In 2010 that figure had dropped to 2,210. In 2011 it had risen to 2,327 and in 2012, it was 2,384.
TRUFFLES
Identifying agricultural areas where truffles will grow is often hit and miss. A Washington company is analyzing data about places where they grow successfully using 11 variables, including geology and altitude, to create maps where the fungi should grow well. Some Oregon truffles are fetching about US$400 a pound at the moment, but this is still about half the cost of some Italian and French ones. Attempts to grow truffles commercially are now being tried in Chile, China and New Zealand.
DRONES
Military drones already fly frequent missions and civilian operations using unmanned aircraft are coming. Ships, like aircraft are increasingly controlled by electronic systems, which makes automation easier. Now the maritime industry is interested in crewless ships for two reasons. The first is safety as most accidents at sea are the result of human error, just as they are in cars and planes. The second reason of course is cost as it is getting harder and harder to sign up competent crews prepared to spend months away at sea. Moreover, some voyages are likely to get even longer for ships with non-urgent cargo as a 30 per cent reduction in speed by a bulk carrier can save around 50 per cent in fuel.
BIRDS
Aircraft strikes by birds are a problem, sometimes a fatal one, for military and civilian aviation alike. America’s Federal Aviation Administration (FAA) reports there are about 10,000 strikes a year to the country’s non-military aircraft costing more than US$957-million in damage and delays. The worldwide figure reported by the European Space Agency is $1.2-billion. Bird strikes have been responsible for 242 deaths between 1912 and 2004. In some countries, radar is being used by air forces to prevent bird strikes by tracking birds that may threaten aircraft. In one, the Israeli air force has reduced the number of strikes it suffers by two-thirds.
BRAZIL
Coffee prices have risen by over 45 per cent so far this year, as severe drought in Brazil combined with leaf rust across Central America has damaged crops. Analysts reckon that this year’s crop will be some 10 per cent smaller than last years. The scarce rain and heatwave have also driven sugar prices to a three-month high. Brazil is the world’s largest producer of both commodities, as well as soyabeans, which are getting more expensive.
TUK-TUKS
They are most commonly associated with the teeming cities of developing Asia, but three-wheeled motorised rickshaws, or tuk- tuks, first emerged in Japan and Italy just over half a century ago. Since then the compact, cheap and adaptable vehicles have spread to every corner of the globe. Bangladesh, Egypt, India, Nigeria, Peru, Sri Lanka and Thailand are now the biggest markets. They are increasingly seen chugging through the streets in east Africa, the Middle East and China. India is the biggest producer, turning out more than 530,000 tuk-tuks a year for the local market and a further 300,000 for export. Some models now run on compressed natural gas rather than diesel and an Australian firm is developing a solar one.
TOMATOES
Developed in Britain, large scale production is now under way of genetically modified purple tomatoes. The pigment, known as anthocyanin, is intended to give tomatoes the same potential health benefits as fruit such as blueberries. Anthocyanin is an anti oxidant which studies on animals show could help fight cancer. Scientists say the new tomatoes could improve the nutritional value of everything from ketchup to pizza topping.
CHARGERS
European politicians have backed a regulation that will force smartphone makers to use just one type of charger. The regulation was drawn to help consumers and to cut down on the amount of electronic waste. It is expected to cut down on electronic clutter and 51,000 tonnes of electronic waste annually.
MEAT
As consumers further tailor their diets to the latest health and wellness trends, 39 per cent of red meat-eaters report consuming less in 2013 than they did in 2012 although 90 per cent say they eat at least some kind of red meat at least once per month. Health trends motivating consumers to cut fat and cholesterol intake are by far the most dominant factors affecting the red meat market. Price is also a factor as 58 per cent of consumers surveyed reported that they have noticed the price of red meat has increased in the past 12 months.
BEER
The market share of craft beer in British Colombia has doubled in four years and shows no sign of slowing. The share was nine per cent of all beers in 2009 and has risen to 19 per cent in 2013. Large breweries’ beer sales declined nearly four per cent last year while sales by microbrewers increased 38 per cent. Last year there were 10 brewery openings and there are at least 21 new breweries in the planning stages for this year, 13 of those in Metro Vancouver.
CARP
The US city of Chicago is considering drastic measures to prevent giant fish infesting North America’s Great Lakes. Authorities are thinking of blocking the city’s canal system to stop Asian carp entering Lake Michigan. Such a move could cost up to US$18-billion and cause huge economic disruption to the city. The species of carp is native to the far East and was originally introduced to southern US states more than three decades ago to control algae build-up in sewage treatment plants. But they escaped into the Mississippi River and proliferated, making their way north towards the Great Lakes.
JOBS
News of job losses in Canada are overshadowing a bright spot in Canada’s labour market. The professional, scientific and technical services sector, which tends to pay above-average wages, hit its highest job level on record last December. This sector led the country’s job growth last year with an increase of 85,000 jobs. It is now the fourth-largest sector by employment in Canada, with more workers than in construction. This sector includes accountants, engineers, architects, lawyers, research and development specialists, surveyors, consultants, graphic designers and marketers. Its share of total employment has climbed to 7.6 per cent from 4.9 per cent two decades ago.
SHIPPING
Insuring the giant ships that traverse the Arctic and Northern Canadian waters is a growing business but one that deals with a great deal of uncertainty. Warmer weather has opened waterways that used to be clogged with ice, but much of Canada’s Arctic territory is uncharted and the capacity to rescue ships in trouble is limited. Governments are concerned about possible pollution from spills of fuel or cargo. On top of that, insurers have limited claims data on which to base underwriting claims.
LIVESTOCK
Canadian farmers reported 12.2-million cattle on their farms at the start of the year, down 0.7 per cent from a year. 82,665 farms reported cattle and calves,1.4-million of which were dairy cows and heifers. Hog producers reported 12.7-million hogs a 1.1 per cent increase, while the number of sheep fell 1.0 per cent to 893,000 head. Canada exported 5.0-million hogs last year, down 12.4 per cent from 2012 and 50 per cent less than the peak in 2007. There were 7,090 hog farms in Canada as of January 1st, 2014.
PARKS
Visitors to national parks in the USA play a pivotal role in boosting nearby economies and supporting jobs throughout the country. A recent report by the Park Service and the US Department of Interior found that about 280-million park visitors helped generate nearly US$27-billion in economic activity and supported 243,000 jobs in 2012. Of those numbers, $14.7-billion was spent in “gateway regions” , or communities within a 60-mile radius of a park, supporting more than 200,000 jobs in those communities. For instance, more than 1.3-million visitors to Joshua Tree National Park in California, helped contribute about $62-million to nearby communities and supported 770 jobs. The Grand Canyon attracted 4.4-million visitors, contributed about $453-million and supported 6,000 jobs.
GOLD
China is poised to become the world’s biggest gold buyer that could support prices of the precious metal as well as accelerate the global bullion market’s shift eastward. Gold purchases by Chinese consumers jumped 41 per cent this past year. China has long had a cultural affinity for precious metals and the increasing affluence of consumers there, along with more relaxed investment restrictions has boosted the country’s demand for gold bars and jewelry alike. The increase was enough to overtake India which for decades, if not centuries, held the No. 1 spot. The price of gold declined 28 per cent in 2013, the biggest drop in 32 years as money managers dumped gold and bought stocks.
POP
The two major manufacturers of soft drink in North America are being forced to find other sources of revenue as their sales decline. The soda makers are struggling with reduced North American demand for their core carbonated drinks and counting more on other products to diversify and bring back customers. In this troubled sector, soft-drink makers are grappling with their products being heavily discounted on store shelves as retailers try to lure consumers who have turned to healthier or trendier products.
COMMUNICATIONS
A burglar in Britain took a photograph of himself with a stolen smartphone while on the job and inadvertently sent it to the authorities. He is now in jail.
Thank you for reading the A & A Economic News Digest. For more information visit our website www.aacb.com or contact A & A Contract Customs Brokers Ltd. at strehler@aacb.com.
Past issues of the A&A Economic News Digest can be found at http://www.aacb.com/publications/ed/index.asp
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