The Case for the Canadian Plastics Industry With over 3,400 companies employing 113,000 workers, Canada's

$33-billion plastics industry is a sophisticated, multi-faceted sector encompassing plastics products, machinery and moulds, and synthetic resins. Canadian machinery manufacturers have gained an international reputation for high quality injection moulding, thermoforming machinery, blown film extrusion systems, extruders for corrugated pipe and other plastic profiles. Canadas plastics industry is closely integrated with other advanced manufacturing sectors such as aerospace, automotive, medical devices and telecommunications. Most companies are Canadian-owned small- and medium-sized firms seeking partnerships and alliances to grow their business and share the rewards of investing in Canada. Sector strengths Plastic Products Canadian exports of plastic products have grown spectacularly from 18% of total shipments in 1990 to 44% in 2008, when exports totalled $7.8 billion. Canadas plastics processing industry represents 4.2% of manufacturing GDP and 5.3% of total manufacturing employment. Growth in the Canadian plastics industry has been fuelled by a dramatic increase in domestic capacity to produce synthetic resins. Over 2,600 firms process synthetic resins into plastic products generating shipments worth $17.9 billion and employing more than 86,000 people.

Competitive clusters Canada has world-class clusters of companies that encompass the full length of the supply chain. The plastics industry is present in all provinces of Canada, but is concentrated in Ontario, Qubec, Alberta and British

Columbia. Central Canada benefits from the synergy that result from having groupings of firms in all four subsectors of the industry synthetic resins, plastics processing machinery, moulds, and plastic products. Alberta is the largest producer of petrochemicals in Canada, the essential ingredients to make plastic products. In British Columbia, the plastics industry has grown to satisfy both domestic and export markets. Whatever the location, these clusters offer high-quality, low-cost operating environments that provide even better levels of profitability. Toronto The business and financial centre of Canada, the Greater Toronto Area is home to the corporate headquarters for industry leaders such as BASF Canada, DuPont Canada, Husky Injection Molding Sytems, Mold-Masters, ABC Group, Woodbridge Group and StackTeck Systems. Montral Montral has an integrated cluster ranging from petroleum refineries to petrochemicals to plastic products. The location offers a tanker terminal for ocean shipments and direct access to the large eastern and central U.S. and Canadian markets. The region's vast supply of diverse and relatively inexpensive energy provides another advantage to manufacturers. Edmonton Edmonton, and its surrounding region, is home to an integrated complex of upgrading, refining, petrochemicals and plastic products. Exceptional economic growth, driven largely by new investments in the oil sands, has created strong demand for producers along the total value chain. Vancouver Vancouver is Canada's gateway to the Pacific. A strong cluster of firms producing plastic products has evolved in the Vancouver area both to serve local markets and for export to the fast-growing markets along the western U.S. seaboard and to Asia.

Aplicacin (Ejercicio): La compaa Mirgrim Plast. Es una subsidiaria de un conglomerado internacional que tiene grandes intereses en la industria domstica. Tiene plantas localizadas en Ontario, Quebec, Alberta. Las plantas producen componentes prefabricados que son entregados a otras compaas ensambladoras en Edmonton, Vancouver y Columbia Britnica. La demanda ha crecido al punto de que Mirgrim Plast puede justificar la construccin de otra planta. El problema inmediato es identificar una ubicacin que reduzca los costos de produccin y de transporte hacia las plantas armadoras existentes. En funcin de la cercana de las fuentes de materias primas y para servir a otros probables mercados, las ubicaciones de las plantas que se proponen estn restringidas a Toronto y Montreal. Los datos de costos, demanda y capacidad de produccin de tales alternativas est en la siguiente tabla:

Los costos de Transporte, $ por unidad son los siguientes:

Cul de las dos ubicaciones de planta (Toronto o Montreal) es la recomendable desde el punto de vista econmico?

Justifique su eleccin diferenciando los costos totales de cada red (De distribucin + Produccin).