Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 15

CASF NEWS
fertilizer to control inflation within its borders. Russia is the
world's largest fertilizer exporter; China is second and Canada is
third (because of its potash exports).
Russia is the world's third largest oil producer (or second
depending on the source). For Canada, the implications of
these developments are quite different. Prices for gasoline and
other fuels have surged in response to concerns about global
oil and gas supplies. Governments need to be vigilant around
the possibilities of the old problem for war profiteering. The
fuel now being sold at elevated prices was made from supplies
bought and paid for long before Putin's invasion. Russian oil
is an utterly marginal element of Canada's energy supply and
should be terminated immediately.
While Canada faces no immediate threat to its energy
security, it will likely face pressure to expand its role as a
geopolitically stable and secure source of fossil fuels, reinforced
by the economic opportunities offered by rising oil and natural
gas prices. These developments could present significant
challenges for Canada's current efforts to reduce its greenhouse
gas emissions by at least 40 per cent relative to 2005 by 2030 and
reaching net-zero emissions by 2050.
Disruptions to food and energy supply chains due to the
conflict are compounding the increases in prices globally as
we pursue transition out of the coronavirus pandemic. Cost of
living is being described as a crisis in the UK as a spring election
looms. Tackling the risks to food supply posed by climate
change is a motivation of stricter environmental regulations
for industry. The war risks nations hitting pause on COP26
committments to prioritize domestic economic stability and
reduce societal stresses. Conversely, industries like surface
finishing face an expensive effort in reducing energy emissions
and emissions taxes en route to a looming economic downturn.
Maintaining business competitiveness for Canadian firms will
need collaboration between government and the private sector,
similar to the efforts undertaken during the Covid-19 pandemic.
Ordinarily, one energy giant turning off the taps would open
the door to another opening them, but that's unlikely to happen
with Canada because pipeline and export capacity for oil and
natural gas are already stretched to their limit. The prospect of
Canada boosting oil exports to take some leverage away from
Putin is an impossibility. Despite sizeable energy resources
in Canada's oilsands, decisions years ago to limit pipeline
expansions have limited North America's ability to export as
much oil as possible, to the point where Canada still imports oil
from overseas.
This might present a renewed interest in nuclear energy,
but that path is far from certain. The economics of new
nuclear facilities remain profoundly unattractive even with
massive governmental support. In addition, Russia's seizure
of Chernobyl, its attack on the Zaporizhzhia nuclear plant and
President Vladimir Putin's thinly veiled nuclear threats have
While Canada faces no immediate threat
to its energy security, it will likely face
pressure to expand its role as a geopolitically
stable and secure source of fossil fuels,
reinforced by the economic opportunities
offered by rising oil and natural gas prices.
provided stark reminders of the security, safety and weapons
proliferation risks associated with a nuclear-heavy pathway to
decarbonization and energy security.
Curtailed exports from Russia and Ukraine have resulted in
a massive and sudden global commodity price shock that tops
anything we've seen in recent decades. Following on the heels of
a large annual increase last year, the Bank of Canada's Canadian
basket of raw material prices is up above the 2021 average
price in the first quarter of 2022. These increases outpace the
commodity price boom of 2007-08.
The prospect of electrification of the auto industry adds to
the instability and shortages of key commodities like nickel
and lithium used for batteries. The NY Times reported data
from the Bureau of Labor Statistics showing new car prices
and auto parts have both climbed upwards of 15 per cent since
2021 and used cars having spiked nearly 40 per cent since the
onset of the semiconductor chip shortages. The auto industry
microchip and commodity shortages have been acutely felt
by the surface finishing industry. This sharp increase in auto
prices and production targets being cut for 2022 and into 2023
by automakers will be felt by our industry cut by cut and with
each household reallocation of spending preferences. For
electroplaters Anglo-American nickel could supplement losses
from Norilsk and Chinese resumption of sodium hypophosphite
production for electroless nickel plating may allow stability to
prevail but that could take months. The impact will trickle down
to investment decisions, talent and labour retention challenges
and potentially to slowing of innovation.
Onshoring or prioritizing domestic production is a longterm
prospect for the manufacturing industry since the many
domestic industry leaders in electronics and the auto industry
supply chain are no longer situated to handle the required
volume demanded by the consumers, as so much has been reliant
on out-sourcing, the infrastructure is no longer there to support
the increased demands. Will we see automakers deepen ties like
the recently announced plan for Honda and GM to co-develop
affordable crossover EVs with solid state battery technology?
Will that become an industry trend to leverage expertise and
May/June 2022
15

Canadian Finishing & Coatings Manufacturing Magazine May/June 2022

Table of Contents for the Digital Edition of Canadian Finishing & Coatings Manufacturing Magazine May/June 2022

Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 1
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 2
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 3
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 4
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 5
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 6
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 7
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 8
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 9
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 10
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 11
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 12
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 13
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 14
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 15
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 16
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 17
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 18
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 19
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 20
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 21
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 22
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 23
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 24
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 25
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 26
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 27
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 28
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 29
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 30
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 31
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 32
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 33
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 34
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 35
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 36
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 37
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 38
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 39
Canadian Finishing & Coatings Manufacturing Magazine May/June 2022 - 40
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