Canadian merchandise trade surplus grows

OTTAWA — Canadian exports rose for the second time this year and imports slipped for the second month in a row, leading to a gap in Canada’s merchandise trade surplus in June.

Exports increased 1.1 percent to $37.6 billion — mostly due to energy products, and industrial goods and materials. At the same time, Canadian companies imported $32.8 billion worth of merchandise, down 0.7 percent from May.

Canada’s trade surplus moved up from $4.1 billion in May to $4.7 billion, the second consecutive month it has grown, Stats Canada reports.

The merchandise trade surplus with the United States stood at $8.2 billion in June — with imports coming primarily from agricultural and fishing products; aircraft, engines and parts; motor vehicle parts including engines; industrial machinery; and consumer goods, particularly medical and pharmaceutical products.

Energy products, industrial goods lead exports:

Auto-autoparts was one of the few sectors that saw
a jump in both exports and imports in June

Gains in these exports, as well as automotive products and forestry products, offset weaker performances in machinery and equipment, agricultural and fishing products.

In the energy products sector exports rose 3.4 percent to $7.4 billion — reflecting increased U.S. demand for crude petroleum (up 3.9%).

Within industrial goods and materials, metals and alloys posted their fourth consecutive advance, rising 5.4 percent, primarily on the strength of copper and alloys (+27.0%), aluminum including alloys (+4.0%), and zinc and alloys (+23.0%). These three commodity sub-groups reached record high levels in the month, according to Stats Can.

Exports of automotive products moved up for a second consecutive month, rising 0.9 percent to $6.9 billion; while forestry product exports edged up 0.3 percent, thanks to the third monthly increase in wood pulp and other wood products (+5.6%), and the second monthly gain in newsprint, other paper and paperboard (+1.8%). These were moderated, however, by a 2.7 percent decline in exports of lumber and sawmill products, which were down for the fifth consecutive month because of the ongoing decline in residential construction activity in the U.S.

Large declines in imports of energy products and industrial goods:

The industrial goods and materials sector accounted for over 95 percent of the net decline in total imports in June.

Although all three commodity groups within the sector fell in June, the bulk of the decrease came from chemicals and plastics, which were down 5.5 percent following a 2.2 percent gain in May. The drop primarily reflected lower demand for organic chemicals by the pharmaceutical and aluminum industries.

Energy was the second largest contributor to June’s overall decrease in imports. Following a 24.0 percent surge in April, imports of energy products posted their second monthly decline, falling by 6.7 percent in June. Crude petroleum imports increased 5.0 percent, but imports of other energy products plunged 22.5 percent.

On the plus side, imports of automotive products increased 1.3 percent to $6.4 billion, solely on the strength of motor vehicle parts, Stats Canada reports.