After a year of record-breaking profits, Canada's chemistry sector plans to make major investments in 2014, according to the 2013 Year-End Survey of Business Conditions released by the Chemistry Industry Association of Canada (CIAC).
In 2013, the Canadian chemistry industry's operating profits reached $3.5 billion -- an all-time record. However, global markets are expected to weaken in 2014, as are prices of many chemical commodities, which could drive sales down a projected 8% next year. In spite of that, CIAC members plan to ramp up their capital investments by 28% in 2014, to $2.6 billion, to take full advantage of Canada's reduced corporate tax rates, accelerated capital cost allowance, and access to competitively-priced natural gas.
“Our members are committed to modernizing their facilities, and to building new production capacity, so that they're ready to seize the opportunity when global markets inevitably recover," says Richard Paton, CIAC's president and CEO.
The year-end survey identified the availability and reliability of electricity as a major competitiveness concern for Canadian chemistry companies, with the impact felt most acutely by inorganic chemical producers. Nevertheless, in 2013, Canada's chemistry industry saw sales exceed $27 billion, matching the pre-recession high achieved in 2008; and exports rise 8% to surpass $18 billion.
To read CIAC's complete 2013 Year-End Survey of Business Conditions, visit www.canadianchemistry.ca.