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Commodity prices hit post-recession high as global demand builds

Oil, steam and natural gas pipelines run through the forest at the Cenovus Foster Creek SAGD oil sands operations near Cold Lake, Alberta in this July 9, 2012 file photo.

TODD KOROL/REUTERS

Commodity prices in Canada are at a post-recession high, according to new research by the National Bank of Canada.

The country's Western provinces in particular stand to gain from improved profits as global demand picks up and the U.S. economy continues to rebound, National Bank economist Stéfane Marion says in a research note published Monday.

"We calculate that the Bank of Canada's commodity price index (BCPI) rose to a post-recession high in [the second quarter] when translated into Canadian dollars," he said.

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The index measures the spot or transaction prices in U.S. dollars of 24 commodities produced in Canada and sold in world markets.

The increase is not limited to energy, said Mr. Marion.

"The price of non-energy commodities produced in Canada and sold in world markets currently stands at a new record high so far in Q2 2014," he said.

The data spell good news for job creation and consumer activity in Western Canada.

"Taken together, these developments are likely to spur consumption and stronger wage increases in the Western provinces where inflation is already averaging 2.3%," said Mr. Marion.

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About the Author
Quebec Business Correspondent

Bertrand has been covering Quebec business and finance since 2000. Before joining The Globe and Mail in 2000, he was the Toronto-based national business correspondent for Southam News. He has a B.A. from McGill University and a Bachelor of Applied Arts from Ryerson. More

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