MNI REALITY CHECK:Canada GDP Resilient As Firms Adapt to Covid

Canadian industry leaders told MNI the economy has become more resilient as firms adapt to pandemic shutdowns, though growth prospects still rest on how soon vaccines roll out and whether more lockdowns are imposed in the meantime.

Statistics Canada will likely report Wednesday at 830am EST that gross domestic product climbed 0.5% in January led by construction and energy production, according to an economist consensus. That would be much faster than December's 0.1% gain and a solid result given many parts of the nation were in second-wave lockdowns around that time. The Bank of Canada has also switched its Q1 GDP estimate to an expansion from a decline, and some economists see January setting the stage for annualized quarterly growth around 4%.

Ron Lemaire, President, Canadian Produce Marketing Association:

"More Canadians are cooking from home and this did benefit the produce industry as we see increased produce sales, between 5-7% through the year," he told MNI.

"Prices are going up because it costs more to plant and harvest fresh fruit and vegetables as well as the increased cost of labor and weather challenges" he said. "We hope everything will balance over time and it may be a short spike as the industry adjusts."

The cycle of closures and re-openings has created hiccups through the system that continue today, especially for restaurants ordering food when they are unsure if they will be shut down again, he said. The industry has adapted to the first two waves of COVID, and there may be more innovations such as "ghost kitchens" that serve customers with little or no dining space, he said.

"Although food services haven't rebounded 100%, over the last year we have seen a rebound," he said. "The summer is going to be very interesting to see-- many municipalities across Canada are being more flexible with patio sizes and enabling a greater number of people outside to dine."

Janice Tranberg, President and CEO, Alberta Cattle Feeders' Association:

"Everybody is holding their breath that we don't have a second processing plant shutdown, because I think that would be devastating," Tranberg told MNI.

"There is still positivity for the industry and hope for continuous growth for our sector," Tranberg said.

While demand has picked up some lately, cattle prices remain well below the five-year average and the cost of barley feed has surged, she said. The recent carbon tax has also raised shipping costs.

David Butters, President, Association of Power Producers of Ontario:

"We are slightly below the demand level from the same time last year, and with the lockdown in January it went down again, but it seems that it is coming back to the pre-Covid levels," he said.

The industry and the economy have adapted to some extent to managing through Covid waves, Butters said in an interview.

"People want to get out more frequently, and hopefully, we will see retail businesses and the commercial sector pick up, that helps demand."