Canada's Trade Deficit Widens in June


Canada's merchandise imports rose 2.3% while exports edged up 0.2% in June. As a result, Canada's trade deficit with the world widened from $954 million in May to $1.8 billion in June.

Imports continued their upward trend and reached a record high of $40.9 billion in June. Overall, six out of seven sectors registered gains, the main contributor being the machinery and equipment sector. Volumes (+2.5%) were up in all sectors.

Exports increased to $39.1 billion. Volumes rose 1.1%, while prices decreased 0.9%. A strong gain in exports of automotive products helped offset declines in five out of seven sectors.

Imports from the United States grew 3.0% to a record high of $25.9 billion in June, a third consecutive monthly increase. Exports rose 2.2% to $29.0 billion. This narrowed the trade surplus with the United States from $3.2 billion in May to $3.1 billion in June.

Imports from countries other than the United States increased 1.1% to $15.0 billion. Exports to countries other than the United States fell for the third consecutive month, down 5.2% to $10.1 billion. Consequently, Canada's trade deficit with countries other than the United States widened from $4.2 billion in May to $4.9 billion in June.

Imports of machinery and equipment increased 3.2% to a record high of $11.2 billion in June. Volumes were up 3.0%. Imports of other machinery and equipment led the gain in the sector, followed by industrial and agricultural machinery.

Imports of other consumer goods rose 4.7% to $5.3 billion. Imports of miscellaneous end products, mainly medicinal and pharmaceutical products, led the gain on higher volumes.

Imports of industrial goods and materials rose 2.3% to $8.5 billion, the third consecutive monthly increase. Widespread gains throughout the sector were led by imports of plastic materials and other iron and steel products.

The only sector to decline in June was energy products, down 3.6% to $4.2 billion. Prices fell 9.2%. Imports of crude petroleum decreased 18.2% to $2.2 billion, as both volumes and prices fell. In contrast, petroleum and coal products registered strong gains in volumes, mainly on higher imports of light oils and preparations.

Exports of automotive products rose 13.9% to $6.3 billion in June as volumes were up 13.2%. The main factor was exports of passenger autos and chassis, which increased 19.5% to $4.3 billion, the highest level since January 2006.

Exports of energy products fell 3.5% to $9.0 billion, as prices fell for the fifth consecutive month. The main contributor was crude petroleum exports, which declined 5.3% to $5.6 billion.

Exports of agricultural and fishing products declined 2.8% to $3.5 billion, the lowest level since August 2011. Leading the decline was a 27.4% decrease in wheat exports, on lower volumes.

In the machinery and equipment sector, exports declined 1.3% to $7.2 billion as volumes fell 2.5%. Lower exports of aircraft and other transportation equipment were the main contributor to the decline.


TradingEconomics.com, Statistics Canada
8/9/2012 1:58:59 PM