Category Archives: Scotiabank

Scotiabank’s Commodity Price Index Shows Retreat in October

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TORONTO, Nov. 24, 2011 /CNW/ – Scotiabank’s Commodity Price Index, which measures price trends in 32 of Canada’s major exports, lost further ground in October, declining 3.7 per cent month over month (m/m). The All Items Index has fallen 9.8 per cent from its near-term peak in April – just prior to the advent of financial market concern over Eurozone debt challenges. While significant, the commodity price correction remains mild compared with the 40 per cent plunge in the second half of 2008.

“Many exchange-traded commodity prices such as copper and zinc have edged up in November and are above the lows of early October,” said Patricia Mohr, Vice-President, Economics and Commodity Market Specialist at Scotiabank. “However, intensifying economic and credit concerns in Europe have contributed to renewed downward pressure on prices in the past week. As well, the failure of the U.S. Congressional Committee to agree on the details of a further deficit reduction package, potentially leading to sequestration – automatic spending reductions of US$1.2 trillion starting in 2013 over a decade – has added to uncertainty.”

The Metals and Minerals Index led the decline in October (-6.9 per cent m/m). Broad-based declines in base and precious metals – with an early-month selloff – and lower quarterly contract prices for Western Canada’s coking coal more than offset a moderate increase in overseas potash prices. The price of premium-grade hard coking coal for Asian sales declined from US$315 to US$285 per tonne (FOB Vancouver).

Iron ore spot prices delivered to Northern China may have bottomed, after plunging in September-October. Chinese steel makers have been cutting stocks of construction-grade steel. Prices rebounded to US$148-151 per tonne in mid-November (+20 per cent in the past several weeks). Potash prices (FOB Vancouver) also inched up to US$502 per tonne in October (+43 per cent year over year), as Canpotex and BPC implemented a price increase in Brazil and Southeast Asia. Given uncertainty over the global economic outlook, producers may hold off on additional price increases until next year.

The Oil and Gas Index eased by -0.6 per cent m/m, as lower Edmonton par prices for light crude and a further decline in Canadian natural gas export prices to the United States just offset firmer heavy crude oil at Hardisty, Alberta and stronger propane prices. Light oil prices at Edmontonhave rebounded in November to the US$95 mark.

Oil prices remain resilient. The spot price of North Sea Brent Blend – a world benchmark used to price some West African and Middle Eastern crudes – has inched up from US$110 per barrel in October to US$111 to date in November. WTI has jumped from US$86 in October to US$96 this month – with its discount off Brent narrowing. Prospective rail and pipeline developments will link new U.S. and Canadian oil plays to U.S. Gulf Coast refining centres, where international prices (Light Louisiana Sweet) prevail.

Pipeline and Rail Developments Alter North American Oil Market Dynamics

Spot WTI oil prices traded at only a slight discount to spot Brent (a world benchmark) in 2009 and much of 2010. However, the discount started to widen in the Fall of 2010, climbing to a record of almost US$30 per barrel on September 6, 2011 (also over US$29 in late September and mid-October).  Oil flows from new developments were arriving at  Cushing, Oklahoma, the pricing point for the NYMEX WTI oil contract, with limited pipeline takeaway capacity to refining centres on the U.S. Gulf Coast.

However, the discount on WTI has narrowed again to US$9-12 in mid-November alongside three developments:

  1. Inventories at Cushing have dropped substantially from the April 2011 high (-23 per cent), with oil producers simply avoiding this hub and selling in other more profitable North American markets;
  2. Rising rail shipments of Bakken light crude oil directly from North Dakota to St. James, Louisiana, diverting crude from Cushing; and
  3. The November 16 announcement by a Canadian pipeline company that it will acquire a 50 per cent interest in the Seaway Crude Pipeline System and — together with a joint owner – will reverse its flow from Cushing to Houston (the largest refining centre in the United States). WTI oil prices jumped by US$3 to US$102.50 on the day of the announcement, though prices have since eased back to US$95.87.

“Despite these positive developments, Western Canada’s oil patch will remain vulnerable to the commercial risks from selling the bulk of its oil to just one key export market – the United States – a market likely to post slow growth at best in coming years,” noted Ms. Mohr.  “This vulnerability suggests the need to build a transportation system to connect the Alberta oil sands to one or more export terminals on the B.C. Coast for onward shipment to the growth markets of Asia – China,Taiwan, South Korea, Japan, and the Philippines. Timing is important, as Alberta crude must be placed in Asian markets ahead of other competing international oil plays.”

Scotia Economics provides clients with in-depth research into the factors shaping the outlook forCanada and the global economy, including macroeconomic developments, currency and capital market trends, commodity and industry performance, as well as monetary, fiscal and public policy issues.

For further information:

Patricia Mohr, Scotia Economics,  (416) 866-4210

Patty Stathokostas, Scotiabank Media Communications, (416) 866-3625

Scotiabank Commodity Price Index Down in September for Second Consecutive

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Scotiabank Commodity Price Index Declines for Second Consecutive Month in September

  • WTI no longer a true benchmark for Alberta light synthetic crude oil.
  • Copper prices rebound from an over-sold position in early October.  Inventories are modest in China. 

TORONTO, Oct. 28, 2011 /CNW/ – Scotiabank’s Commodity Price Index, which measures price trends in 32 of Canada’s major exports, fell by 1.1 per cent month over month (m/m) in September, the second consecutive monthly decline. The All Items Index has retreated by 6.2 per cent from the near-term high last April, just prior to the advent of financial market concern over sovereign-debt challenges in the Eurozone.

“The commodity price correction has been mild compared with the 40 per cent plunge in the second half of 2008,” said Patricia Mohr, Vice-President, Economics and Commodity Market Specialist at Scotiabank. “While exchange-traded commodity prices declined sharply in early October, prices for oil, copper and the grains have rallied back in recent weeks on optimism that measures would be implemented to shore up the Eurozone financial system and bolster liquidity, culminating in a broad agreement on October 27.”

Nevertheless, a number of commodities not traded on exchanges (e.g. coking coal and iron ore) will likely be adjusted down in October, when quarterly contract prices are re-negotiated – dampened by uncertainty over global economic conditions and somewhat slower growth in China. The contract price for Western Canada’s premium-grade hard coking coal will decline from US$315 per tonne (FOB Vancouver) to a still lucrative US$285 in October. While prices may recede further in early 2012, the medium-term outlook for premium-grade hard coking coal remains favourable. Only 35 per cent of China’s domestic coal reserves are premium grade, while China requires 50 per cent for use in its larger blast furnaces.

The Oil and Gas Index inched ahead in September (+0.7 per cent m/m). The gain reflected a surprising increase for both light crude oil in Edmonton and Hardisty Heavy crude in Alberta – the two prices used in the Scotiabank Commodity Price Index — despite a slight decline in WTI oil.

“The price of WTI oil at Cushing, Oklahoma, the pricing point for the NYMEX contract, is no longer as relevant a marker as it once was for light synthetic crude oil from the Alberta oil sands,” noted Ms. Mohr.

WTI oil prices edged down from US$86.34 per barrel in August to US$85.58 in September. Oil prices are particularly sensitive to sentiment on the global economic outlook, falling as low as US$75.67 on October 4, before rebounding strongly to US$93 on October 27 on news of the Eurozone plan and a pick-up in U.S. third-quarter GDP growth (+ 2.5 per cent from a mere 1.3 per cent in the second quarter). However, WTI oil prices continue to trade at a wide US$20 discount to Brent — a better benchmark of world oil prices. WTI prices at Cushing, Oklahoma have been dampened by rising volumes of crude oil from the Alberta oil sands and the U.S. Mid-continent to Cushing in the face of onward pipeline constraints to refining centres in the U.S. Gulf Coast.

In contrast, the price of light synthetic crude oil (SCO) from Alberta (upgraded bitumen) has averaged US$103 per barrel in 2011 YTD – a US$9 premium over WTI oil. While this partly reflects upgrader outages in the Alberta oil sands, it also reflects a trend towards pricing SCO off its cracking parity with competing, higher-priced crude oil (such as Light Louisiana Sweet) in U.S. Midwest refining centres.

In September, the Metal and Mineral sub-component lost significant ground (-2.5 per cent m/m). Widespread declines in base metals and lower silver prices more than offset flat potash prices and gains in gold, sulphur, uranium and cobalt (a steel alloying agent).  LME prices for copper – the bellwether for base metals – dropped from US$4.10 per pound in August to US$3.77 in September and a low of US$3.08 in early October, before surging back to US$3.65 on the 27th.  Prices remain exceptionally profitable, yielding a 60 per cent profit margin over average world break-even costs including depreciation.

“Copper prices were over-sold in early October, given prospects for a supply deficit in the fourth quarter, that is, global demand will exceed refined metal supplies,” concluded Ms. Mohr. “China stepped up its purchases in early October recognizing bargain prices, pulling down LME stocks in South Korea. At the height of concern over Eurozone prospects, traders appear to have focused their profit-taking on copper, as well as nickel, given its comparatively large margin over costs and where the bulk of long positions probably resided.”

Scotia Economics provides clients with in-depth research into the factors shaping the outlook for Canada and the global economy, including macroeconomic developments, currency and capital market trends, commodity and industry performance, as well as monetary, fiscal and public policy issues.

For further information:

Patricia Mohr, Scotia Economics, (416) 866-4210,
Patty Stathokostas, Scotiabank Media Communications, (416) 866-3625

Scotiabank Toronto Waterfront Marathon Highlights

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The Scotiabank has proudly announced highlights of the Scotiabank Toronto Waterfront Marathon in their press release dated October 16,2011. But, before you read it, here is an exclusive MetroActive bird’s eye video of the race as it passes by the Pinnacle buildings along the waterfront.

Now for the press release.

Canadians Coolsaet and Gillis qualify for London Olympics at 2011 Scotiabank Toronto Waterfront Marathon

Toronto’s premier running event raised more than $3.5 million for 164 local charities

TORONTO, Oct. 16, 2011 /CNW/ – Today was a spectacular day for Canadian pride at the 2011 Scotiabank Toronto Waterfront Marathon (STWM), with Canadian runners Reid Coolsaet and Eric Gillis qualifying for the London Olympics. More than 22,000 runners took to the streets in windy conditions, raising more than $3.5 million for 164 local charities.

Coolsaet and Gillis, his training partner at Speed River Track Club in Guelph, ON, finished third (2:10:55) and fourth (2:11:28) respectively at STWM, meeting the Canadian Olympic standard and ensuring their spots on the 2012 Olympic Team. Coolsaet’s time was the fastest time ever run by a Canadian on Canadian soil and the second fastest time ever for a Canadian over the classic 42k distance. Gillis, who met the qualifying standard by merely one second, previously represented Canada at the 2008 Beijing Olympics in the 10,000m.

Kenya’s Kenneth Mungara won the overall men’s title with a time of 2:09:51. Ethiopia’s Shami Dawit narrowly lost a thrilling sprint to the finish line, also being timed in 2:09:51 for second. The women’s race was equally exciting. Despite battling a tough headwind over the last seven kilometres, Ethiopia’s diminutive Koren Yal, equaled the course record of 2:22:43 defeating fellow Ethiopian Mare Dibaba by 42 seconds to claim the top prize. Yal’s performance was the ninth fastest women’s marathon run in the world so far this year.

“This was a remarkable breakthrough day for Canadian marathoning,” said Alan Brookes, Race Director. “Over the past few years our IAAF Silver Label race has established itself as one of the best in the world and today’s times confirm that. Most exciting today is that our Canadians ran with the best in the world and punched their tickets to London. We’re thrilled and so proud of not only our elite athletes, but also the 22,000 other runners that collectively raised a record-breaking amount for charity.”

“I am extremely proud to report that the 2011 Scotiabank Toronto Waterfront Marathon has raised over $3.5 million for some incredible Canadian charities,” said John Doig, Senior Vice-President, Toronto Region, Scotiabank. “STWM is an amazing event where people from all over the world can run, cheer on loved ones, or raise money for charity. It’s a great combination of athleticism, philanthropy and community spirit.”

Marathon Highlights

Men’s Race – Kenya’s Kenneth Mungara was crowned Scotiabank Toronto Waterfront Marathon champion for the fourth consecutive year, with a finishing time of 2:09:51. Mungara previously broke the record for fastest time on Canadian soil at STWM in 2010 (2:07:57).

Women’s Race – Koren Yal, from Ethiopia, placed first in the women’s race (2:22:43) just ahead of fellow Ethiopian Mare Dibaba who came in second (2:23:25). Russia’s Silvia Skvortsova came third in 2:27:51.

Canadian Standings – Reid Coolsaet of the Speed River Track Club in Guelph, ON, led the Canadians with an overall third-place finish with an international-class time of 2:10:55, qualifying him for the 2012 Olympic Games. Also qualifying for the London Olympics is Reid’s clubmate Eric Gillis who finished fourth at 2:11:28. Particularly noteworthy is that six Canadians finished in the top ten in this world-class event.

Half-Marathon – Thomas Breitbach won the men’s half-marathon, with a time of 1:07:21, and Leslie Sexton took the women’s title with 1:16:32.

Milton, ON phenom, Ed Whitlock, 80, continued to re-write the record books, running 3:15:54 for a new M80+ age-group world record. The longstanding previous mark was 3:39 which Whitlock took down to 3:25 in Rotterdam in April before slicing down nine more minutes today at STWM.

Capping off an incredible event, 100 year-old Fauja Singh (India) is set to break the world record for the oldest person to complete a marathon with a finish time of 8:25:16.
The full list of results for the 22nd Scotiabank Toronto Waterfront Marathon is available at www.stwm.ca.

The Scotiabank Group Charity Challenge and Neighbourhood Challenge together surpassed the $3 million target with a total of more than $3.5 million as of press time. This remarkable achievement exceeds last year’s total of $2.54 million. In addition, Scotiabank will award $6,000 to the three charities with the most runners, the largest amount of pledges per runner and the most money raised in pledges.

Along the marathon course, 12 Neighbourhood Cheering and Entertainment stations encouraged the runners to the finish line as part of the Scotiabank Neighbourhood Challenge. To honour their exuberance and support, Scotiabank will award them a charity bonus of $6,000 for having the most people, best costumes, best entertainment, and above all, creating the most noise. This year’s challenge was the best-ever with tons of spectators and incredible costumes, with the final report on the winners being issued later this week.

About the Scotiabank Toronto Waterfront Marathon (STWM)

For the fourth consecutive year, the STWM has been awarded a prestigious Silver Label by the International Association of Athletics Federations (IAAF). This designation makes the STWM one of only five internationally recognized IAAF Label marathons in North America. In 2010, the STWM was ranked as 6th fastest marathon in the world, 3rd fastest women’s race in the world and holds the record for both the fastest men’s and women’s marathons on Canadian soil (2:07:58 run last year by Kenneth Mungara and 2:22:43 by Sharon Cherop equaled today by Koren Yal). The Scotiabank Toronto Waterfront Marathon attracts participants from over 50 countries and this year’s goal is to raise more than $3 million for 164 charities reached $3.5 million as of press time.

The Scotiabank Toronto Waterfront Marathon includes a 5km, half-marathon (21.1km), and full marathon (42.2km) run. For more information, please visit www.stwm.ca.

About Scotiabank

Scotiabank is committed to supporting the communities in which we live and work, both in Canada and abroad, through our global philanthropic program, ‘Bright Future.’ Recognized as a leader internationally and among Canadian corporations for our charitable donations and philanthropic activities, Scotiabank has provided on average approximately $44 million annually to community causes around the world over the last five years. Visit us at www.scotiabank.com.

Image with caption: “Eric Gillis (left) and Reid Coolsaet celebrate at the 2011 Scotiabank Toronto Waterfront Marathon (October 16, 2011) after qualifying for the 2012 London Olympics.

Image with caption: “Kenneth Mungara of Kenya wins his 4th consecutive Scotiabank Toronto Waterfront Marathon (October 16, 2011) with a time of 2:09:51.

Image with caption: “More than 22,000 runners take to the streets of Toronto for the 2011 Scotiabank Toronto Waterfront Marathon (October 16, 2011), raising more than $3.5 million for charity.

Image with caption: “British Sikh 100 year-old Fauja Singh completes the 42.2km 2011 Scotiabank Toronto Waterfront Marathon (October 16, 2011) with a time of 8:25:16.

For further information:

Julia Wall-Clarke, Narrative Advocacy Media
Tricia Soltys, Narrative Advocacy Media

Patty Stathokostas, Scotiabank Media Communications

Canadian Small Businesses Face Reality of Slower and Uneven Economic Growth

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TORONTO, Oct. 13, 2011 /CNW/ – Canadian businesses of all sizes are likely to face challenging conditions in the months ahead, according to a report released today by Scotia Economics. Domestic prospects are being constrained by the much slower and uneven pace of economic growth in most advanced nations, amid increasing fiscal restraint and persistently high unemployment. Meanwhile, intensifying debt-related strains in the euro zone and the United States suggest that financial markets will remain volatile during this adjustment period, dampening business and consumer confidence.

“Small firms are particularly sensitive to domestic demand, so their ability to maintain momentum will depend in large part on the resilience of consumer and business expenditures,” said Adrienne Warren, Senior Economist, Scotia Economics. “We expect consumers to be cautious spenders for the time being, given high household debt loads and some recent softening in employment conditions. A more subdued outlook for housing and renovation activity will reinforce this outlook.”

However, household employment, income and spending trends will continue to have a distinct regional performance differential, with the commodity-sensitive areas benefitting from more buoyant conditions than those regions more reliant on non-resource exports to the established markets in the United States, Europe and Japan.

“While activity in Western Canada and Newfoundland and Labrador is being supported by continued strength in resource-related investments, Central and Maritime Canada’s heavier exposure to a slowing U.S. economy suggests relatively more moderate growth prospects for small and large businesses alike,” noted Ms. Warren.

The current environment favours firms whose products and services are geared to corporate customers over those that rely primarily on households. While businesses may become more conservative in new hiring and investment in the months ahead, corporate balance sheet strength provides considerable flexibility to maintain current expenditures. Small businesses also will continue to benefit from the ongoing buoyancy in resource-related activity.

According to the report, the best growth prospects for many small firms may lie in their ability to tap export markets, notwithstanding the near-term disruptions to global trade flows. The fast-growing emerging nations in Asia and Latin America in particular offer considerable growth potential. Exporters focused on the more traditional markets of theUnited States and Europe will undoubtedly be challenged by underlying weak demand and less favourable demographic trends.

“Beyond the adjustment to a more muted outlook for global demand over the near-term, small businesses must continue to adapt to broader longer-term shifts in the economic landscape,” concluded Ms. Warren. “Key issues facing small businesses include an aging population, rising immigration, skilled labour shortages, particularly in the construction trades, a high Canadian dollar, and high energy costs.”

Scotia Economics provides clients with in-depth research into the factors shaping the outlook for Canada and the global economy, including macroeconomic developments, currency and capital market trends, commodity and industry performance, as well as monetary, fiscal and public policy issues.

For further information:
Adrienne Warren, Scotia Economics, (416) 866-4315
Alex Koustas, Scotia Economics, (416) 866-4212
Patty Stathokostas, Scotiabank Media Communications, (416) 866-3625

Scotiabank Launches “Bright Future” Community Program

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Craig Kielburger helps launch global philanthropic program

January 21, 2011 @ 12:00PM

Toronto – Scotiabank today launched an international philanthropic program uniting the Bank’s charitable, social and community efforts and employee volunteer activities under one new banner – Scotiabank Bright Future. Scotiabank President and CEO Rick Waugh was joined by special guests including Free The Children Founder, Craig Kielburger as he announced the program at an event held in Toronto earlier today.

“From its earliest days almost 180 years ago in Halifax, Nova Scotia, Scotiabank has held a steadfast belief in supporting the unique needs of each community it serves,” said Rick Waugh, President and Chief Executive Officer, Scotiabank.  “While our operations have grown worldwide, we have maintained our focus on community service. The Bright Future program will enable Scotiabank and its 70,000 employees worldwide to build upon this tradition of creating a bright future – one community at a time.”

Elements of the Bright Future program:

Employee engagement and recognition: In 2010, Scotiabank employees spent more than 324,000 hours volunteering and fundraising, and by applying through the Bank’s formal community programs they generated C$7.5 million in additional funding for the organizations that they support. As part of today’s launch, the Bank also introduced the Bright Future Community Leadership Awards which will be given to Scotiabank employees for outstanding commitment to their community and leadership in helping those in need.  Scotiabank will make a financial donation to the designated charity of the winners.

Scotiabank Bright Future Young Leaders Award: As part of the launch Scotiabank today also announced the establishment of “The Scotiabank Bright Future Young Leaders Award”, which will recognize youth from Canada and international locations for outstanding contribution to their communities annually. Applications for the first youth awards will be accepted later this year, with the first recipients announced in the spring of 2012.  Further details on the youth awards programs will be available in the coming months at www.scotiabankbrightfuture.com  

Community and Charitable Giving: Over the last five years Scotiabank has provided on average approximately $44 million annually to community causes around the world. We’ve made it easier and more transparent for charities to make an application through a dedicated website. To mark the launch, Scotiabank announced a C$1 million gift to Toronto-based Hospital tor Sick Children’s International Patient Program that provides life changing care to children from outside of Canada.

Centralized information: The Bright Future program, including information for charities seeking support, can be found on the Bright Future website in English, Spanish and French at www.scotiabankbrightfuture.com. The Bank will also be launching a new internal Bright Future platform in three languages, which includes all information on the program as well as localized lists of volunteer opportunities for employees.

“Giving back in meaningful ways is an intrinsic part of Scotiabank’s history, culture and identity,” said Sylvia Chrominska, Group Head, Global Human Resources and Communications, Scotiabank. “Bright Future builds on our past practices, creates a new shared philanthropic program that respects local priorities and introduces new initiatives that will bring even greater value to those around us.”

Bright Future’s origins began in 2007 in Scotiabank’s Caribbean and Latin American markets. With today’s announcement all Scotiabank donations and charitable activities – wherever they take place in the world – will be part of the Bright Future program.

“Bright Future has been a success in Mexico and we are proud that through this program we have been able to be part of building stronger, more vibrant communities by supporting the work of our charitable partners,” said Nicole Reich de Polignac, Executive Vice-President and President & CEO, Grupo Financiero Scotiabank, who participated in today’s launch from her office in Mexico City. “On behalf of my team in Mexico and my colleagues in other countries from Canada to Chile, Puerto Rico to Peru, we look forward to building on this success.”

Engaging a New Generation

Scotiabank was pleased to welcome Free The Children Founder, Craig Kielburger, who participated in today’s launch. In addition to inspiring and motivating the audience to be community active, he applauded Bright Future’s recognition of the importance of youth for future philanthropic success.

“Through the Scotiabank Bright Future Young Leaders Award we have an opportunity to recognize the contribution of young people who are active in their communities and, at the same time, reach out to those who have yet to become active volunteers,” said Mr. Waugh. “Engagement of youth around the world is vital to the continued operation of charitable and not-for-profit enterprises.”

Public Attitudes towards Corporate Philanthropy

A recent Canadian poll conducted by Harris/Decima demonstrates that people feel strongly about corporate philanthropy. Nearly three-quarters of Canadians (72 per cent) are more inclined to volunteer, fundraise, or donate to local charities provided their employer supports these initiatives.

“Canadians have long recognized and appreciated the efforts of the companies that support and sustain the very communities in which they operate,” said Marcel Lauziere, President and CEO, Imagine Canada. ”The Scotiabank global Bright Future program demonstrates the pride and commitment of Scotiabank and its employees to the communities it serves, but more importantly to the causes that strengthen and enrich quality of life around the world.”

The Scotiabank Bright Future program comes at the beginning of the 10th anniversary of the International Year of Volunteerism. Information on the program can be found on the Bright Future website at www.scotiabankbrightfuture.com.

The Scotiabank Bright Future Poll was conducted by Harris/Decima via teleVox, the company’s national telephone omnibus.  A total of 1,030 Canadians were surveyed from December 16th to December 19th, 2010.  Results are accurate to within +/- 3.1% 19 times out of 20.

For details on the programs outlined above and for more information, see BACKGROUNDER: SCOTIABANK BRIGHT FUTURE PHILANTHROPIC PROGRAM