Canada Trade Gap Narrows in September

Canada’s trade deficit decreased to CAD 0.98 billion in September 2019 from an upwardly revised CAD 1.24 billion in the previous month and compared with market expectations of a 0.7 billion shortfall. Imports fell at a quicker 1.7 percent month-over-month, on fewer metal and non-metallic mineral product acquisitions, particularly gold. Meantime, exports decreased 1.3 percent, led by energy products, mostly crude and also gold.
Statistics Canada | Luisa Carvalho | 11/5/2019 2:37:25 PM
Total imports slumped 1.7 percent over the previous month to CAD 50.8 billion in September. Declines were observed in 7 of 11 product sections, of which metal and non-metallic mineral products (-9.2 percent), mainly due to gold as well as iron and steel products; other transportation equipment and parts (-27.7 percent), mainly due to lower acquisitions of parts for other transportation equipment from Belgium; and metal ores and non-metallic minerals (-20.5 percent), namely gold and copper on lower shipments from Peru, Japan and Brazil.

Imports from the US went down 0.4 percent and those from countries outside the US dipped 4.1 percent. Lower imports from Belgium (parts for other transportation equipment) and Switzerland (pharmaceutical products) were partially offset by higher imports from China (cellphones) and the United Kingdom (various products).

Total exports fell 1.3 percent to CAD 49.8 billion, largely offsetting the increase in August. Decreases were observed in 7 of 11 product sections. Overseas sales fell mostly for metal and non-metallic mineral products (-7.3 percent), attributable to gold (-CAD 371 million) and energy products, due to lower crude oil exports (-2.1 percent) on account of lower volumes. This recent decline coincides with decreased production at certain Canadian North Atlantic oil platforms, as well as at certain refineries in the American Midwest. Also, shipments fell for farm, fishing and intermediate food products (-7.3 percent), with canola exports (-48.9 percent) contributing the most to this decline, reaching their lowest level in more than six years. Exports of other crop products (mainly soybeans) also posted a significant decrease in September. Partially offsetting these declines were sales of other transportation equipment and parts, which almost doubled, driven largely by higher exports of other transportation equipment to Saudi Arabia. 

Exports to the US were down 0.6 percent and those to countries other than the US decreased 3.3 percent, the second consecutive monthly drop. Lower exports to the Netherlands (crude oil and iron ore), India (coal and potash), Norway (nickel) and Mexico (canola) contributed the most to the decrease.

The country's trade surplus with the U.S, its main trading partner, was largely unchanged in September as both exports and imports fell. The surplus decreased slightly to CAD 4.8 billion from CAD 4.9 billion in August.

Considering the third quarter of the year, exports fell 2.3 percent mainly due to lower sales of energy products and imports were down 0.6 percent, amid reduced acquisitions of energy products (-4.4 percent) and motor vehicles and parts (-1.2 percent).

Canada Trade Gap Narrows in September