Canadian Trade Deficit At 9-Month Low In October

Canada's merchandise trade gap was recorded at a CAD 1.1 billion in October of 2016, following an upwardly revised CAD 4.38 billion shortfall in the previous month while markets expected CAD 2 billion deficit. It is the lowest trade gap since January, as imports fell 6.3 percent while imports rose 0.5 percent.

Following a record high in September, total imports were down 6.3 percent to CAD 44.7 billion in October, the lowest level since February 2015. The large decline was mostly attributable to lower imports of industrial machinery, equipment and parts (-42 percent to CAD 4.0 billion) This decrease followed a high-value shipment from South Korea destined for the Hebron offshore oil project, which was responsible for the large increase in September. Also, imports fell for energy products (-11.6 percent to CAD 2.0 billion, the third consecutive monthly decrease) and metal ores and non-metallic minerals. Meanwhile, imports rose by 1.6 percent to CAD 5.3 billion for electronic and electrical equipment. Excluding the CAD 2.9 billion increase in imports of industrial machinery, equipment and parts, total imports would have decreased 0.3 percent, and the trade deficit would have narrowed from CAD 1.5 billion in September to CAD 1.1 billion in October. 

Imports from the United States edged down 0.1 percent to CAD 29.7 billion and from countries other than the United States fell 16.7 percent to CAD 15.0 billion. Lower imports from South Korea (-CAD 3.0 billion) were primarily responsible for the decrease, mainly reflecting the large shipment intended for the Hebron offshore oil project in September. There were also lower imports from Algeria and Saudi Arabia, while imports increased from China and Switzerland. 

Total exports rose 0.5 percent to CAD 43.6 billion. Higher sales of energy products (+5.5 percent to CAD 6.5 billion, the eighth consecutive monthly increase) and motor vehicles and parts (+3.2 percent to CAD 8 billion) were partially offset by lower exports of consumer goods (-3.2 percent to CAD 6 billion) and aircraft and other transportation equipment and parts (-4.5 percent to CAD 1.9 billion). Exports excluding energy products were down 0.3 percent. 

Exports to the United States increased 1.6 percent to  CAD 32.8 billion, led by crude oil and crude bitumen. Sales to countries other than the United States decreased 2.7 percent to CAD 10.8 billion. Sales to the United Kingdom fell 469 million on fewer exports of precious metals. There were also lower exports to Brazil, while exports to Saudi Arabia and the Netherlands increased.

Year over year, total exports increased 1.3 percent while imports were down 1.3 percent. 

Statistics Canada | Yekaterina Guchshina |
12/6/2016 2:30:29 PM