Ontario’s mining industry supports the province’s balance of trade

This article was provided by the Ontario Mining Association (OMA), an organization that was established in 1920 to represent the mining industry of the province.

The mining industry in Ontario is a steady, reliable, regular and positive contributor to the province’s balance of international trade, according to a recent sectoral economic impact study. Mining: Dynamic and Dependable for Ontario’s Future was produced by University of Toronto economists Peter Dungan and Steve Murphy.

“As Ontario’s international trade balance has deteriorated over the past 10 years due to a combination of a strengthening currency and the weakness of its major trading partner, trade in mineral products has become increasingly important,” says the study. Since 2002, the overall international trade deficit for the province has more than quadrupled to $70 billion-plus annually.

“The trade surplus for Ontario mineral products has strengthened to more than $12 billion annually, remaining positive over the entire period (2002-2011),” according to the report. “As well, Ontario international mineral trade has accounted for over half of the surplus in the country’s mineral trade over this period.”

“The Ontario international trade balances for both nickel and gold (the province’s two most important mineral products by value) have remained positive over the last years. The opening of the diamond mine in the province in 2008 has also boosted the province’s trade bottom line.”

The study cautions that “determining the location of mining company customers can be somewhat tricky because some companies do further refining of their production before they ship it to their ultimate customer, while others do not.” Nevertheless, it appears about 60% of Ontario’s mineral output, which was valued at $10.7 billion in 2011, was exported.

From this total 21.9% was shipped to the United States in 2011, up from 15% in 2010; 15% was sent to Europe, down from 19.9% in 2010; 10.1% was transported to China, up from 7.3% in 2010; and 11.3% was sent to the Rest of the World, down from 17% in 2010.

From the 40% of the value of mineral production that was not exported internationally, about two-thirds of it remained in Ontario. The remainder was shipped elsewhere in Canada. “As a large proportion of Ontario mineral production is exported abroad, it is important to understand what contribution mineral trade makes to the trade balance for the province and indeed the country.”

A full version of Mining: Dynamic and Dependable for Ontario’s Future, which can be downloaded, can be found on the OMA website www.oma.on.ca. Mining operations are responsible partners in society. This Ontario industry produces commodities that are in demand and people around the world are willing to purchase them. The industry’s contribution to the province’s balance of international trade benefits all Ontarians.

 

 

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