Canada records decline in exports and largest trade deficit since October 2022

 In May 2023, Canada registered its largest trade deficit since October 2020, as government data revealed a surprising downturn in grain and energy product exports and an increase in car imports.

The Canadian Statistical Institute stated on Thursday that the deficit amounted to 3.4 billion Canadian dollars (USD 2.5 billion), after two months of surplus.

In April, the country had recorded a trade surplus of 894 million Canadian dollars. Exports decreased by 3.8 percent, with two-thirds of the decline attributable to energy and agricultural and food products.

Exports of agricultural products and fishing saw the most significant decline in May, falling by 13.4 percent.

The numbers suggest that demand for Canadian grains has slowed in recent months due to improved global supply, particularly for wheat and canola.

The energy sector, a key driver of the Canadian economy, also saw a decrease in exports by 7.3 percent in May due to falling prices.

In terms of imports, most sectors witnessed an increase, with a total rise of 3 percent, or around 2 billion Canadian dollars.

Imports of gold, silver, platinum, and their unprocessed alloys increased by 42.8 percent due to large shipments of silver received from the United Kingdom.

The Canadian Statistical Agency attributes this increase to economic uncertainty, which leads to a higher demand for precious metals.

Additionally, imports of cars and their parts increased by 4.5 percent.

The trade surplus with the United States, which constitutes the majority of Canada's trade, shrank to 6.7 billion Canadian dollars.

 

AFP