In June 2024, Canada witnessed substantial changes in its international merchandise trade, marking a significant turnaround in its trade balance. According to the latest data released by Statistics Canada, both exports and imports saw noteworthy increases, leading to a positive shift in the country’s trade balance.
Canada’s merchandise exports experienced a robust 5.5% rise in June, reaching a total of $66.6 billion. This marked the largest percentage increase since February 2024. The majority of the increase was driven by significant gains in crude oil and unwrought gold exports, which together accounted for more than three-quarters of the total rise in export value. In real terms, exports saw a 3.8% increase.
The energy sector was a major contributor, with exports of energy products climbing by 11.7%, primarily due to a 13.3% increase in crude oil exports. The expansion of the Trans Mountain pipeline facilitated higher crude oil deliveries to Asian markets, contributing to this surge. Additionally, the exports of metal and non-metallic mineral products rebounded by 11.8% in June, following a decline in May. Notably, exports of unwrought gold saw a significant 35.3% increase, driven by higher demand and geopolitical factors influencing the gold market.
On the import side, there was a 1.9% increase in June, bringing total imports to $66.0 billion, closely matching the record high seen in June 2022. The rise in imports was driven by increases in nine out of eleven product sections. Motor vehicles and parts played a key role, with imports rising by 5.1% after a decline in May. Imports of passenger cars and light trucks reached a record $6.8 billion, reflecting a recovery from production disruptions earlier in the year.
Imports of consumer goods also saw a 3.7% increase, with pharmaceutical products leading the way with a 16.9% rise. However, these gains were partially offset by a significant 17.1% drop in imports of metal ores and non-metallic minerals, following a substantial increase in May.
The positive shift in exports, coupled with a moderate rise in imports, resulted in Canada’s merchandise trade balance moving from a deficit of $1.6 billion in May to a surplus of $638 million in June. This surplus falls within the typical bounds for monthly revisions applied to imports and exports.
Trade with the United States saw a notable increase, with exports rising by 2.6% and imports by 1.7%. Consequently, Canada’s trade surplus with the United States widened to $9.4 billion in June, the largest surplus since November 2023. This marks the third consecutive month of increased trade surplus with the U.S.
Exports to countries other than the United States rebounded sharply by 15.7% in June, following a decline in May. This rebound was driven by significant increases in exports to the United Kingdom, India, and Italy. Imports from these countries also saw a modest increase of 2.1%. As a result, Canada’s trade deficit with countries other than the United States narrowed from $10.4 billion in May to $8.7 billion in June.
On a quarterly basis, both imports and exports showed growth. Imports rose by 2.0% in the second quarter, driven by higher imports of motor vehicles and parts, and metal and non-metallic mineral products. Exports increased by 1.1%, with aircraft and other transportation equipment, and energy products contributing the most. However, these gains were offset by a decline in exports of motor vehicles and parts.
In real terms, calculated using chained 2017 dollars, quarterly imports increased by 0.3%, while exports declined by 0.4%, led by lower exports of metal and non-metallic mineral products.
Revisions to the May data showed slight increases in both imports and exports. Imports were revised from $64.4 billion to $64.8 billion, and exports from $62.4 billion to $63.2 billion.
In the services sector, June saw a 0.6% increase in monthly service exports to $17.2 billion, while imports of services rose by 1.6% to $18.3 billion. Combining goods and services, Canada’s total trade deficit with the world narrowed significantly from $2.6 billion in May to $501 million in June.