Canada’s Trade Surplus Shrinks by $1.1 Billion in September

(StatsCan via Exchange Market Post)

Canada’s trade surplus with the world decreased to $4.5 billion in September from $5.6 billion in August, as exports declined and imports rose. This marks the lowest trade surplus since January 2008.

Canadian exports declined for the second consecutive month, dropping 1.0% to $42.5 billion. The movement was isolated to a drop in prices as volumes remained flat. The retreat was led by industrial goods and materials, automotive products, and energy products.

Canada’s imports increased 1.9% in September to $38.0 billion, as both prices and volumes increased. September’s gain marked the fifth increase in six months following a 5.7% decline in August.

Exports to the United States declined for the second consecutive month as imports remained relatively unchanged at $23.7 billion. Exports fell 1.3% to $32.1 billion, largely due to energy products and automotive products. As a result, the trade surplus with the United States contracted to $8.3 billion in September from $8.7 billion in August.
Exports to countries other than the United States remained flat at $10.4 billion, while imports from these countries collectively increased 5.5%. Consequently, Canada’s trade deficit with countries other than the United States expanded to $3.8 billion in September from $3.1 billion in August.

Widespread price declines push export values down

Exports of industrial goods and materials fell for the second consecutive month, decreasing 1.9% to $9.9 billion, as a result of declining prices as volumes edged up. This was the first export price drop in 2008 for a sector that has experienced high commodity prices. Reduced exports to Japan and the United States pushed copper down.

Exports of automotive products fell 3.4% to $5.1 billion, the eighth decline in 12 months. The fall in exports was driven by volume as prices have been on the rise since March 2008. A production plant shutdown and low vehicle sales in the United States were two of the main factors leading to lower exports of trucks and passenger autos in September. Read more here.