On Friday afternoon, I did a brief presentation at the Impact of Development Conference/Workshop held at the historic Trinity United Church on Algoma Street in Thunder Bay. My talk (which you can access here under "Looking Back and Looking Forward") was titled "Resources and the Northern and Northwestern Ontario Economies: Past, Present and Future." Along with a quick survey of the economic history of northern Ontario and an overview of current economic indicators, I also opined on the current state of developments in the Ring of Fire.
For the benefit of those not fully acquainted with the Ring of Fire, it is of course the massive planned chromite mining and smelting development project in the mineral-rich James Bay Lowland region. The area covers about 5,000 square kilometers but development has been slow. Major players include Noront Resources, the Ontario government and nine first nations. There have been a number of challenges including the cost of capital and transportation infrastructure to access the chromite, energy costs, the lengthy environmental assessment process as well as the process of consultation and negotiation with the nine members of the Matawa Tribal council. You can get a very good detailed analysis of the issues in the Skogstad-Alahmar report here.
However, all of these challenges can be resolved once the real challenge is resolved: commodity prices. Much of the hype in the Ring of Fire springs from the spike in ferro-chrome prices in the 2008-09 period which was followed by a collapse from which there has yet to be a recovery. As the accompanying figure illustrates, there was a 60 percent drop in the price of ferro-chrome and the price has not gone anywhere since.
In the end, its all about commodity prices and until the market price goes up and makes the project profitable, not much else is going to happen.
Northern Economist 2.0
Sunday 4 March 2018
Tuesday 27 February 2018
The Impact of Development
There is going to be a conference on economic development ithis week. The Impact of Development workshop will be held this Thursday and Friday at Trinity United Hall, 310 Park Street Thunder Bay and has been made possible through the support of the Resources, Economy, and Society Research Group (RESRG) at Lakehead University, ReSDA: Resources and Sustainable Development in the Arctic, Lakehead University Department of History, Canadian International Council – Thunder Bay Branch, and Lakehead University Faculty of Social Sciences and Humanities.
The focus of the conference is single industry communities and features presentations on northern Ontario, Atlantic Canada as well as the Arctic and even Latin America. Among the resource sectors covered are forestry and mining. Moreover, a glance at the program will illustrate that there will be a diverse set of perspectives available with respect to development. I will be doing an overview on the resource sector experience in northwestern Ontario with a foray into mining and the Ring of Fire on the Friday afternoon. See the program below.
Day 1
Day 2: Morning
Day 2: Afternoon
Everyone is welcome!
The focus of the conference is single industry communities and features presentations on northern Ontario, Atlantic Canada as well as the Arctic and even Latin America. Among the resource sectors covered are forestry and mining. Moreover, a glance at the program will illustrate that there will be a diverse set of perspectives available with respect to development. I will be doing an overview on the resource sector experience in northwestern Ontario with a foray into mining and the Ring of Fire on the Friday afternoon. See the program below.
Day 1
Day 2: Morning
Day 2: Afternoon
Everyone is welcome!
Thursday 15 February 2018
Recent Labour Force Numbers for Northern Ontario Are Not Pretty
Last week’s labour force numbers for Canada
from Statistics
Canada were seen as a bit of a shock given that employment
fell by 88,000 in January. Part-time employment declined (-137,000), while full-time employment was up (+49,000). At
the same time, the unemployment rate increased by 0.1 percentage
points to 5.9%. Ontario also
declined by about 51,000 jobs and much of the loss was due to part-time work. So how does northern Ontario compare when
recent labour force estimates are looked at?
The accompanying figure looks at
employment growth for northeast and northwest Ontario compared to Ontario and
Canada between December 2017 and January 2018.
Whereas Ontario and Canada saw employment drop by just over one half of
one percent, total employment in the northeast declined 2.4 percent while in
the northwest it fell by 1.8 percent. As
well, the losses were more driven by full-time employment as it dropped 2.5 percent
in the northeast and 2.3 percent in the northwest. All one can hope is that the January numbers
are a short-term aberration because northern Ontario saw its employment drop
more than either Ontario or Canada and the northeast seems to have been hit harder.
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